WWW Copy of pages 317 and 318 from Dianetics and Scientology Dictionary

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XXX 17 pages nondisclosure and release bond

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YYY Copy document entitled “Confidential Intelligence Chief”

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ZZZ Copy 1-page letter dated 9-1-81

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LOS ANGELES, CALIFORNIA; WEDNESDAY, MAY 23, 1984; 9:52 A.M.

-oOo-

THE COURT: All right. We are back in session.

GERALD ARMSTRONG, having been previously duly sworn, resumed the stand and testified further as follows:

THE COURT: The witness has retaken the stand. Just state your name again for the record. You are still under oath.

THE WITNESS: Gerald Armstrong.

THE COURT: Yes, Mr. Harris?

MR. HARRIS: Yes, just briefly.

There is a representative, a custodian of records of the Bonaventure Hotel who is here, James Wilson; is that correct?

MR. WILSON: That’s right.

MR. HARRIS: Who just has some records which we will be using on our rebuttal.

THE COURT: Does he want to deliver them to the clerk?

MR. HARRIS: Yes.

THE COURT: You may do so.

Is there any declaration attached to it?

MR. HARRIS: No, that is why he is here, Your Honor. I was hoping we could get into a stipulation that he would testify that these are records maintained by the Bonaventure in the ordinary course of business.

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They are Mr. Flynn’s visit at the Bonaventure which date has become at issue.

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MR. FLYNN: We can stipulate to it, Your Honor.

THE COURT: We can excuse the gentleman from the hotel. All right. Then you may continue, Mr. Flynn, with your examination.

MR. FLYNN: Thank you, Your Honor.

REDIRECT EXAMINATION (Resumed) BY MR. FLYNN:

Q Mr. Armstrong, with reference to that Guardian Full Hat, I am not sure whether I asked you what the purpose of the Full Hat was?

THE COURT: Are you referring now to something in the abstract, or that particular exhibit?

MR. FLYNN: That exhibit, Your Honor, which is HHH. I don’t think you have to get it.

Q What was the purpose of that exhibit HHH, Mr. Armstrong?

A I believe that was the intelligence Full Hat, information Full Hat. Information was a euphemism for Intelligence Bureau. And the Full Hat is the complete set of materials.

One usually gets a Mini Hat which is a condensation of the more important materials one is trained on. But the purpose of any hat is to train the person whose job it is, whose hat it is in the all the functions and duties of the particular position.

And this is to train intelligence personnel in the Guardian’s Office the procedures and duties of the

THE COURT: Are you able to identify that particular Full Hat as the one that was in existence?

THE WITNESS: Well, very likely, Your Honor. We had one in the Port Captain’s office. And it would have been in 1974-1975.

This one here is dated 9 September, 1974; so it is very likely the same one.

Occasionally these things got updated. And there were changes made in the check sheet or the list of materials included in the Hat.

But we had one like this in the Port Captain’s office in the intelligence department which I saw in 1974.

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Q Now, let me show you a document –

Your Honor, may we have it marked next in order?

THE COURT: Triple T.

Q BY MR. FLYNN: Has that document a document that was included in the archives?

A I can’t say with certainty. There was a set of materials regarding FBI, Hubbard’s relations with the FBI, and there was a set of materials indicating this type of investigation at this period. This appears to be maybe in the ’50s, ‘61, because one of the sets of materials provided by Vaughn Young to Omar Garrison included the time track of FBI and other agencies investigations into Scientology, in other words, a chronology, and there was this type of material included in there, but I don’t recall the specific document.

Q Among the materials that you did find in there, did you find that there were documents relating to the fact that the Federal Bureau of Investigation had received numerous inquiries and complaints concerning Mr. Hubbard?

MR. HARRIS: I am going to object to that. The witness is not able to identify this. If it is out of the archives, it should be in Your Honor’s custody. Apparently it isn’t and Mr. Flynn, without having the witness identify the document, now starts reading from the document.

I object. It is improper.

MR. FLYNN: Your Honor, as far as its coming out of the archives, it comes out of my files not out of archives, and I have, as I have indicated to the court on numerous occasions, extensive files pertaining to Mr. Hubbard.

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THE COURT: Well I don’t know what the relevancy of it is.

MR. HARRIS: Why doesn’t Mr. Flynn show it to Your Honor?

MR. FLYNN: it is only — the relevancy has to do with Mr. Harris’ questioning about the fact that the organization was suffering from religious persecution. I simply want to show the court that over the years there were numerous complaints which had come in at least to this governmental agency about the organization.

THE COURT: Oh, I will sustain the objection. I don’t think this contributes anything to the lawsuit.

Q BY MR. FLYNN: Mr. Armstrong, several documents have been brought into court with reference to the administrative files in the biography project.

Can you give the court an estimate of approximately how much material exists in the administrative files relating to the biography project while you were conducting it?

A There was probably, in addition to whatever is here, there would probably be another five to eight inches of files relating directly to the biography project.

Q And what basically is in those files?

A Well they go back to the earlier attempts to get the biography done. They include some of the surveys which were done relative to the biography. They include the materials on the contract negotiations themselves, correspondence with Omar Garrison.

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There was correspondence between Mr. Garrison and Mary Sue Hubbard regarding the biography.

Q How much correspondence is there with Mary Sue Hubbard in those files?

A Well, in the total files dealing directly with it, there would probably be — I don’t know, maybe 20 things back and forth; Laurel to her, her to Laurel, me to her.

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Q Now, are there numerous documents in those files that cross-reference or correlate aspects of the biography project to the MCCS Mission?

A Yes. I think there would be a lot of them.

Laurel at that point had — as I say, she was doing two jobs and dealing with the same attorney who handled both matters, MCCS and the biography thing.

Laurel was in continual communication with Mary Sue regarding MCCS; also, the biography and also the archives trust which bridged the two subjects because the disposition of the — the final disposition of the materials that I was collecting was being worked out for a final deposit in this thing called the archives trust.

Q And that archives trust was the trust that was being set up, as you previously testified, in connection with which Mr. Hubbard was going to take a tax deduction; is that correct?

A Right. That was my understanding.

MR. LITT: I’ll make the same objection; any knowledge that he has from this comes from his participation in MCCS.

THE COURT: I’ll strike it.

Q BY MR. FLYNN: Mr. Armstrong, were you shown exhibit 36 which is in your handwriting? Is that correct?

A Yes.

Q And at the bottom of the page, the first page of exhibit 36 there is a notation, “. . .she has also just told me that I am to be her second on the mission.” Is that correct?

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A Yes.

Q And what does that refer to?

A This refers to the mission, the MCCS Mission.

Q Now, this is at the time when you were moving into the Los Angeles building from Gilman Hot Springs in February, 1980; is that correct?

A Right.

Q And your testimony was that the reason you moved in there on the biography project was because of the fact that it was combined with the MCCS Mission; is that correct?

A Right.

Q And does exhibit 36 support that?

MR. LITT: Objection. Calls for a conclusion.

THE COURT: I’ll sustain the objection.

The document speaks for itself.

Q BY MR. FLYNN: Now, at that time how many people were involved in the MCCS Mission in February, 1980?

A Well, David Miscavige operated the Mission. He was the Mission OPS.

Laurel Sullivan was the in-charge. I was the Mission second.

We had a Guardian’s Office personnel who was assigned and who had either a Guardian’s Office designation or sometimes we referred to him as MCCS third. That was Rick Klingler.

So immediately there were three of us involved.

As time went on the positions changed.

Rick Klingler dropped out and another Guardian’s

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Office person was assigned, a girl. I just don’t recall her name right now.

And then Dick Sullivan, Barbara DeCelle and Lisa Britowich was assigned sometime later.

Q On exhibit 36 it states, “. . .Senior PPRO has sent for Shirley Litman, CIC PPRO BU and me. Reserve to transfer the pack so she can continue to operate the bureau while doing her mission.” who is referred to as the senior PPRO?

A Laurel Sullivan.

Q And the mission that is referred to in exhibit 36 as the senior PPRO continuing to operate her mission, is that the MCCS Mission?

A Yes.

Q Now, when you left did you take any documents, administrative files, relating to the MCCS Mission?

A No.

Q And if you had planned your departure, Mr. Armstrong, with the idea of harming the organization or Mr. Hubbard, would you have taken — what files would you have taken more than any other files?

MR. LITT: Objection. That calls for speculation.

THE COURT: Overruled.

THE WITNESS: Well, I think if I had planned it, I could have made off with a lot of files that would be particularly more useful than the files I have.

But the MCCS files, certainly, would have been important. The — various LRH orders into the PR Bureau like,

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for example, the Nobel Prize stuff, these are things which would have been available to me.

I suppose I could have made great inroads in the Intelligence Bureau if I had been real eager. But I didn’t make off with anything. But the materials that could have been obtained would have been more revealing than the ones that are here now.

Q BY MR. FLYNN: Now, you have testified on cross-examination about the gradual removal of your belongings from the organization, a box at a time; do you recall that?

A Yes.

Q Was there a policy or practice in the organization that when a person tried to leave, to keep their belongings, for the organization to keep their belongings?

MR. HARRIS: Your Honor, this is beyond the scope of cross-examination.

THE COURT: Well, it goes to state of mind, I suppose.

THE WITNESS: Yes; it happened with many people throughout the time I was involved in the organization. People were not allowed to leave with the personal Scientology materials in many cases. And all kinds of impediments would have been put in the way of me getting materials out, my own personal things. That was really the reason why the stuff went out a bit at a time.

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Q BY MR. FLYNN: Now, exhibit 30 is your — what you termed your official notice of resignation dated 12 December, 1981; is that correct?

A Yes.

Q Now you stated in there that, “I spent the last several months trying to get Omar copied all the materials he would need and more stuff kept pouring in.”

What did you mean by that statement, “more stuff kept pouring in,” Mr. Armstrong?

A Well, right up to the end of my stay, I kept getting more material. The final boxes of the Pers Com arrived, the final Pers Sec materials arrived, the stuff from Controller archives arrived, and there was more than I could possibly copy.

Q Now these were materials that you had been trying to procure or obtain possession of for several months prior to that?

A Yeah. I guess the Controller archives — the only reason I did not have them months before that was that Tom Vorm told me that he was simply too busy to go through all the materials, so we waited until he had a time when he was more or less free. Then he went through the materials with me.

The Pers Com materials only arrived some time in 1981, and there was such a mass of them. They were in very big boxes and they were kept for a long time in the external communications bureau, the LRH external communications bureau in another building, and I brought them over a box at a time

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throughout that period until I finally had all of them there, but there was such a mass of then, there was simply no way to go through them all.

Q What was your state of mind with regard to your obligation to complete the project based on the agreement that Mr. Garrison had with PDK and that you felt you had with Mr. Hubbard with regard to getting him, Mr. Garrison, documents before you left?

A Well I felt very committed to that. That is the reason that I tried to get copied everything that I could, and my wife and I worked so hard in the last two weeks to try and do that.

Q And you didn’t take any files of any nature that fell outside the biography project and you could have taken the MCCS files; is that correct?

A Well I could have done that, but I did take financial — my own personal things, and that is actually when I went back in some time in February or — either January or February I saw Vaughn Young, and I realized that there was this file of all my copies, and the reason I took that was because basically on board the ship I had run into a problem with the organization in accounting for a disbursement which I had and the rule was laid down that if you didn’t keep a copy of your turned-in accounts, then you could be liable if the organization didn’t find it, and in that case I had to pay for the amount of the disbursement because the treasury bureau at that time had lost my accounting, so I had to pay again.

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So, following that, I tried as much as possible to keep copies of all the money received and all ay accounting for that money. So I went back in and spoke to Vaughn and I took — it was only my copy. The organization had all the other documents and the accounting.

Q And per your letter of 12 December, 1981 you advised the organization, particularly Barbara De Celle, of the fact that you had taken those documents in the last several months and given them to Omar Garrison; is that correct?

A Yes. I also spoke to Barbara at the same time and told her the status of everything in archives.

Q And per this letter you asked that you not be harassed by the organization; is that correct?

A Yes.

Q Now you were asked some questions on cross-examination with regard to Mr. Garrison’s ability to use the documents prior to the publication of the biography by placing the documents in the public domain; do you recall that?

A Not those specific words, but something to that effect, yes.

Q And referring you to 500 7C which is under seal, was that part of a plan for Mr. Garrison to do precisely that?

MR. LITT: Objection; beyond the scope, Your Honor. There was no inquiry in cross-examination on that topic.

THE COURT: Counsel, cross-examination went several days I don’t see how anything could be beyond the scope of the cross.

MR. FLYNN: I have got a specific note on it.

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THE COURT: Let’s not worry about it. We have been here for so long, we could spend a few more days — a few more minutes.

MR. FLYNN: I am going to try and go as quickly as I can, Your Honor, to wrap this up.

Q Are you familiar with 500 7C?

A Yes.

Q And is there a particular page that relates to Mr. Garrison going around the world and promoting the biography with materials that you had collected?

A There is a reference, I believe, to a tour. There is a reference to a video to be done, and the tour may be in the other documents. I don’t know, but this refers to a prepublication interview caper, a sneak preview to his full length biography.

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Q So what was your understanding as to whether Mr. Garrison could use materials that you had collected, Mr. Armstrong, prior to the publication of the book in connection with the sneak preview caper?

A Well, I fully expected that they would be used.

Q Now, you were asked some questions about the inventory that Mr. Wilhite did.

Do you know who paid Mr. Wilhite for that inventory?

A Well, it was paid by LRH accounts. And my recollection is that the original orders came from Mike Smith who was the LRH accounts at the beginning of 1980 and that it was subsequently paid by the person who followed him as LRH accounts who was Jim Isaacson. It was specifically to be L. Ron Hubbard’s money as part of the archives trust that was being worked on.

MR. LITT: The same objection, Your Honor. Mr. Armstrong, to the extent he knows anything about this knows about it as a result of having been on MCCS and relates to advice given by attorneys. And as to whether it occurred or not, we go through this again and again. It is improper.

THE COURT: The whole answer? Is that your contention?

MR. LITT: The statement that he makes about what was to happen to the trust.

THE COURT: What was to happen to the trust is stricken.

Q BY MR. FLYNN: What happened was Mr. Smith from LRH accounts was paying Mr. Wilhite?

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A That is correct.

Q And LRH accounts means L. Ron Hubbard accounts?

A Yes.

Q Who is Mr. Wilhite?

A Mr. Wilhite is a Scientologist. He had been involved — he was — he owned a small publishing company and he had obtained permission to re-publish some of Mr. Hubbard’s early fiction work.

He had re-published a book called “Buckskin Brigades.” And I believe a set of short stories from one of the pulp magazines, Argosy, perhaps.

He was a collector of Hubbard material.

He had been in the Intelligence Bureau in St. Louis. And I believe he told me that he was busted or somehow he left the Guardian’s Office.

And at the time that I knew him, because he was an expert in what fiction works Mr. Hubbard had written and he was a collector of fiction works, we got together because I had a number of fiction works which I was trying to identify or locate. And he was very helpful. Between us I had a lot of information on the subject; he had a lot of information on the subject. So we pooled our information.

Because he was knowledgeable, he was chosen to do the inventory by the LRH accounts.

Q He had worked in the B-l Bureau of the Guardian’s Office; is that correct?

A Yes.

Q Now, you were asked several questions about your

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knowledge of lawsuits against members of the organization from 1979, I believe, until 1981; do you recall those questions?

A Yes.

Q Now, were you aware — forgetting for the moment those particular years — were you aware of lawsuits that the organization had brought against former members when you left?

A Well, I knew there were some. I can’t tell you how many.

At the beginning of the biography project I received from controller assistant for legal Ann Mulligan a list of all the lawsuits, all the — both the criminal and the civil cases which the organization was involved in. And my recollection is that there was something over 100 cases then going on in the United States and something like 200 internationally. It was quite a booklet full of materials which laid out at least for a lot of cases their assessment of where the case was, where it stood, and what was next going to happen in the case.

There are so many I do not recall names, but included in that list were lawsuits against individuals and damage claims or cases brought by individuals against Scientology. There was a number included in that long list.

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Q Did you know an individual in the organization named Lona [Lorna] Levitt?

A I can’t say if I ever met her. I knew the name. I knew the name from the time when I was in Vancouver because she was a fairly well-known Scientologist from, I believe, Calgary.

Q And do you know whether she was being sued along with about 10 other Scientologists up in Calgary?

MR. HARRIS: At what time, Your Honor?

Q BY MR. FLYNN: In the late 1970’s, early 1980’s.

MR. HARRIS: At what time did he know? This is what I am asking.

THE COURT: Well I assume it would have no relevancy unless you were aware of this in ‘81.

THE WITNESS: Well I was aware of actions against Lona Levitt. It was Laurel Sullivan who told me that the Guardian’s office had an assassination planned –

THE COURT: Well for the moment we will limit it to lawsuits. Limited to lawsuits at the moment.

THE WITNESS: I had not heard about a lawsuit specifically, although it very easily may have been on the list which I got from Ann Mulligan. Again I don’t recall names from that list.

Q BY MR. FLYNN: In connection with this assassination attempt, did Laurel Sullivan tell you that the individual who was involved had turned himself into the Toronto police?

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MR. HARRIS: I will object; calls for hearsay.

THE COURT: Well, assumes a fact not in evidence.

Q BY MR. FLYNN: Did you have any conversation with Laurel Sullivan about whether or not the individual who was involved in the Guardian’s office in the assassination attempt had turned himself into the Toronto police?

MR. HARRIS: Same objection; hearsay.

THE COURT: Well it would be received only to show his state of mind, but we struck the point — the part about there possibly being such an action. I don’t know whether there was or there wasn’t.

Certainly whether he was aware in December ‘81 when he left or shortly thereafter would be relevant or admissible to show his state of mind.

Q BY MR. FLYNN: What was your state of mind with regard to that, Mr. Armstrong, as to whether or not an individual had turned himself into the Toronto police?

A I did not hear of that. Laurel told me that the Deputy Deputy Guardian US, second in command in the United State’s office, had told her about the assassination plan and that was Duke Snyder or the information came from Duke Snyder. Whether or not there was — I don’t recall right now if she said it was him talking to her or if it came out of his Sec checks, but in any case the information surfaced as a result of the investigation being done out at Gilman Hot Springs.

Q Now were you aware of a lawsuit against Robert Kaufman, former member of the organization, when you left

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the organization?

A I’d heard of this lawsuit against Kaufman, yes.

Q And how about Lucy Garritano?

A Well, I knew of something with the Garritano family, but not specifically on that. Kaufman I did know for a fact.

Q Peter Graves?

A I did not know the name at that time.

Q James Gervais?

A I don’t know if I knew the name at the time or not.

Q Now did you know what had been done to an individual named Allard in the early ’70’s, late ’60’s?

A I knew something about what had been done.

Q Were you aware that approximately 18 lawsuits had been brought against Paulette Cooper, a journalist?

A I did not know the figure. I know of lawsuits against her.

Q And what was your state of mind with regard to whether those lawsuits had been brought to harass her?

A Well I knew that that was the policy of the organization.

Q And what if any understanding did you have with regard to the number of lawsuits that had been brought against Michael Flynn, Mr. Armstrong?

A I didn’t know anything about that at the time, although again it could have been included in this list.

Q And had you read the Level O checksheet by

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L. Ron Hubbard?

A At some time I believe I did, yes, at least a lot of it.

Q And were you aware of Mr. Hubbard’s views at the time that, “The law can be used very easily to harass and enough harassment of someone can destroy them”; on page 55 of Level O checksheet?

A I had read this.

Q And you generally knew about the type of activities the Guardian’s office was engaged and similar to the type that is set forth in the Assistant Guardian’s full hat that has been marked as an exhibit in this; is that correct, Mr. Armstrong?

A Yes.

Q And were you familiar with HCO policy letter of 1 March, 1966, The Guardian?

May that be marked next in order?

THE COURT: Triple U.

MR. HARRIS: May I see the page you were referring to?

MR. FLYNN: 55.

Q Are you familiar with the policy set forth in triple U, Mr. Armstrong?

A Yeah, I have read it.

Q And were you aware in 1980-1981 that the Guardian’s office has the power to control all Scientology organizations?

MR. LITT: Was he aware or did he believe it?

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THE COURT: All right. Assumes a fact not in evidence as phrased.

Q BY MR. FLYNN: Well, you were familiar with the policy; is that correct, Mr. Armstrong?

A Yes.

Q What was your understanding of the policy, The Guardian, in 1980-1981 with regard to the powers of the Guardian’s office?

A 1980 the Guardian’s office had tremendous power and could at that time, except for the CMO and the personal office of L. Ron Hubbard, they had virtually absolute control.

However, around that time a second body grew in power underneath Mr. Hubbard, and that was the CMO, particularly with DC and the people in the special project from within the latter group came a group of individuals who were able to disintegrate the Guardian’s office and take over the control which they had previously had so that the control of Scientology organizations and Scientology bank accounts then shifted to the new group which was the special project personnel, which in 1982 became RTC and ASI.

Q Do you know whether the appointment of Bill Franks as executive director of the organization related to the removal of Mary Sue Hubbard from her post as Controller?

A I don’t have the specific connection myself personally. I knew that it was around the same time, and I heard at the time of the removal of Mary Sue Hubbard, but I did not see anything myself relating to that.

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Q Now, you testified about the fact that you were concerned that in March, 1982 the archives in the possession of Mr. Garrison would be stolen by the organization; do you recall that?

A Yes.

Q Now, at that time were you aware of policies of the organization to steal files?

A Yes.

Q And referring you to exhibit HHH, the Information Full Hat of the United States Guardian’s Office, on page 6, under the drilling procedures for investigation, No. 8, No. 9, “Dispatch 9 March, ‘70 re successful and unsuccessful actions”? do you see that?

Q To your knowledge was Jane Kember the Guardian Worldwide at the time, Mr. Armstrong?

A Yes.

MR. LITT: At what time?

THE COURT: 9 March, ‘70.

MR. FLYNN: 9 March, ‘70.

MR. HARRIS: Are we marking this, Your Honor?

MR. FLYNN: May this be marked next in order, Your Honor?

THE COURT: VVV.

MR. HARRIS: May I Voir Dire the witness on this,

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Your Honor?

THE COURT: Yes.

VOIR DIRE EXAMINATION BY MR. HARRIS:

Q Prior to leaving the Scientology organization, Mr. Armstrong, had you seen this document as exhibit ZZZ?

THE COURT: No; VVV.

MR. HARRIS: Sorry. VVV.

THE WITNESS: It is over here.

Q BY MR. HARRIS: Were you just looking at it?

A A second only.

MR. FLYNN: Those pages may be mixed up, may not be inorder,Your Honor. The copy that I have, the pages are out of order.

THE WITNESS: Yes. I had seen this.

MR. HARRIS: Thank you, Your Honor.

REDIRECT EXAMINATION (Resumed) BY MR. FLYNN:

Q Now, referring you to what is your copy, the third page, there is a list of successful actions by the B-l Branch of the Guardian’s Office. And among them are direct theft of documents; do you see that, Mr. Armstrong?

A I think this is one of the unsuccessful actions.

Q I think they are out of order. I think that is one of the successful ones.

That page should be page 2, Your Honor.

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Q It appears connected to the exhibit as page 3, but I believe it is page 2.

MR. LITT: Your Honor, Mr. Flynn is not testifying.

And you cannot tell from the documents if the witness cannot tell what order it goes in.

MR. FLYNN: I have a better copy where the page numbers are more clearly set forth, Your Honor, which I’ll represent to the court I’ll find. But I’m very familiar with this document.

THE COURT: Well, let’s do something with it.

Q BY MR. FLYNN: Mr. Armstrong, do you know whether the Guardian’s Office was involved in direct theft of documents during the 1970’s?

A Yes.

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Q And when you and Mr. Garrison in March 1982 were concerned that the documents he had would be stolen by the Guardian’s office, is that when they were brought to Mr. Crago’s apartment?

A No, that was some time later. That is when I began the copying of them from Mr. Garrison.

Q In order to make a duplicate set?

A Right.

Q And when you sent the documents to my office in connection with this case, were you aware that the Guardian office had policies such as set forth in exhibit triple V to steal documents?

Q And she said that processing files were not auditing files; do you recall that, Mr. Armstrong?

A I recall that.

Q Is that true?

A No.

Q And are you familiar with a book “Dianetics and Scientology Technical Dictionary”?

A Yes.

Q And on page 317 of that book under the definition of “Processing,” it is called “Auditing by which the Auditor Listens and Commands”; is that correct?

A Yes.

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Q Now are there numerous references to your knowledge in Scientology literature about processing being auditing?

A Many.

MR. FLYNN: And, Your Honor, rather than mark the book, I have a copy. May that be marked next in order?

THE COURT: Yes; triple W.

Q BY MR. FLYNN: What was the title of the individual in the organization, Mr. Armstrong, who maintained possession of auditing files?

A The person who maintained possession?

Q Of the auditing files.

A Well they were generally stored in a — the bulk of them were kept in a storage area because of the mass of them, and generally Tech Services would be the people to retrieve on command all the auditing files. There would be an individual file or files which would be kept with the auditor, with the CS during a particular auditing action. The bulk of the files or back files or old auditing files would be kept in storage.

Q And based on your experience in Scientology between 1970 and 1981, did the term “Processing” apply to auditing?

A Yes.

Q And were processing files auditing files?

A Yes.

Q Now, several letters, I believe approximately 10 letters, were marked as defense exhibits under seal by

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Mr. Litt between Mary Sue Hubbard and L. Ron Hubbard that you were questioned about; do you recall that?

A Yes.

THE COURT: Did you mean defense exhibits or plaintiff exhibits?

MR. FLYNN: I am sorry, Your Honor. Intervenor’s exhibits.

THE COURT: All right.

Q BY MR. FLYNN: And those come from a large group of letters that are under seal that have not been brought up to the courtroom that the defense has not marked as exhibits; is that correct?

A Yes.

Q Would you give the court an estimate of how many letters between Mary Sue Hubbard and L. Ron Hubbard are under seal from the archives?

A Between the two of them back and forth, I’d say maybe a couple of hundred.

Q In terms of inches high, is it somewhere between six to ten inches of letters?

A Well it would be closer to six, I think. I don’t think there was 10 inches.

Q Now are you familiar with those letters?

A To some degree, yes.

Q And were you authorized, Mr. Armstrong, to give those private letters to Mr. Garrison?

A Yes.

Q And, in fact —

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MR. LITT: Your Honor, I am going to move to strike the last, the term “authorize” is vague. He’s already testified as to what the factual situation was. Authorization is a conclusion.

THE COURT: He can state his state of mind. Received for that purpose.

Q BY MR. FLYNN: With regard to plaintiff’s exhibit 7 page 2 paragraph 2, “It is our understanding that the cooperation to be given Mr. Garrison by CSC will include the following: Providing Mr. Garrison access to archives and records including POI documents” — that is freedom of information?

THE COURT: It goes to his state of mind, his belief, what he was relying upon. Overruled.

Q BY MR. FLYNN: Did anyone ever, throughout the period of time you were working on the project, prevent you from giving those letters to Mr. Garrison?

A No.

Q Did Mary Sue Hubbard ever tell you not to give them to Omar Garrison?

A No.

Q With regard to the letters that are downstairs that have not been brought up, do you have a general understanding of the contents of those letters?

A General, yes.

Q And in general are those letters personal, or do they relate to the business of running the Church of Scientology?

A Well, there is a great deal of business that is included in those letters. Specific — the majority of the letters from Mr. Hubbard to Mrs. Hubbard and a great number of them postdate the ‘66 resignation.

Thereafter, a great percentage of the letters are devoted to business, the operation of the organization and transfers of money and so on.

There is within each letter or, at least to some

2882

degree, there is an aspect of — what could be called personal and nonbusiness, when they are talking about kids, that sort of thing. I would not call that organization business. But I would say that the majority of the pages are devoted to business.

Q So after 1966, at least through your experience, between 1970 and 1981 was it your understanding that Mrs. Hubbard and Mr. Hubbard together ran the Church of Scientology?

A Well, they were the top two, definitely.

Mr. Hubbard was senior; so he controlled her. She did not control him. It was not a partnership. But under him she controlled the Guardian’s Office. So she controlled that aspect of the organization.

Q So in your experience the affairs of Mary Sue Hubbard and L. Ron Hubbard with regard to the operation of the Churches of Scientology were mixed together, at least between 1970 and 1981 to some degree; is that correct?

A Yes.

Q And do the letters basically reflect that, MR. Armstrong?

A Yes.

Q And what is the reason that those letters were selected to be sent to me by you?

A Well, I guess they were what I had. But I — the significance of those letters to me was that they showed that very thing; they showed that he used Mary Sue in a way from the organization to control the organization during

2883

that period, during a period when he was telling people he no longer managed Scientology organizations and that he didn’t control them.

Q Who was the first Guardian of the Church of Scientology to your knowledge?

A Mary Sue Hubbard.

Q And pursuant to this HCO policy letter of 1 March, 1966 marked as exhibit UUU, the office of the Guardian is located in the office of LRK; is that correct?

A Yes.

Q And who was the only — pursuant to that policy the only senior executive to the Guardian at that time, Mr. Armstrong? Referring to the second paragraph.

A The executive director.

Q And Mr. Hubbard resigned as executive director in 1966 supposedly?

A That is what he said, yes.

Q In practice, that isn’t what happened per your observations; is that correct?

A Correct.

Q Who is the next executive director of the organization to your knowledge appointed in 1981?

MR. LITT: Objection. Asked and answered.

This was asked, I believe, yesterday of Mr. Armstrong. I may be wrong about that.

THE COURT: I think he asked that of Mrs. Hubbard; she didn’t know, or something, didn’t remember.

MR. LITT: My mistake, Your Honor.

2884

Q BY MR. FLYNN: Who was the next executive?

A The next one was Bill Franks.

Q In 1981?

A I believe it was mid-’81.

Q And is that the same Bill Franks that was locked up at Gilman Hot Springs in November of 1981, about the time you left the organization?

MR. HARRIS: I object. That assumes facts not in evidence except Mr. Flynn’s statement of it.

THE COURT: Sustained.

Q BY MR. FLYNN: What was your state of mind in November, 1981 as to whether Mr. Franks, executive director of Worldwide of the Church of Scientology, was locked up at Gilman Hot Springs?

A Was that yes, he was or had been.

Q Now, Mr. Litt referred to a number of documents that — such as manuscripts, Excaliber, items of that nature that you sent to my office; why did you send those to my office, Mr. Armstrong?

A Well, I sent everything to you because I was afraid and I was seeking assistance. And I thought that the documents would be safest with you. And I — everyone I was connected with would be safest doing that.

Some of the materials I sent to you at a time when I just sought to get everything out of the house which still remained.

I had sent you on a more methodical basis at one point and then I just couldn’t take the pressure any more

2885

and I just wanted to get rid of everything. So some of those materials I had not gone through or in the depth that I had gone through some of the materials. And some of it I had not even looked at, but I just included it in the end of the materials just to send to you.

2886

Q And you had been accused of stealing all of these materials when you sent them to me; is that correct?

A That was my feeling after getting the Declare and beginning to understand where the organization was coming from regarding this whole thing and all the charges laid out on that Suppressive Person Declare.

Q Now you included letters from Mr. Hubbard’s first wife, do you recall, that you sent to my office or the office of Contos & Bunch?

A Yes.

Q And did those letters show the chronology of Mr. Hubbard’s life, where he had been and dates and things of that nature?

A Yes.

Q And was that one of the reasons they were involved in the biography project?

A Well, yes. I mean, they contained essential information the man’s life from 1932 through just about, I guess, 1947, so a big period of his life was contained in that correspondence.

Q Now did a number of those letters such as what has been marked as exhibit 500 30, exhibit 500 31 and exhibit 500 29 relate to the period between 1938 and 1941 when Mr. Hubbard had supposedly received $10,000 from Warner Brothers that he put into a bank account that he said in a dispatch in 1980 that he used after the war to take a Caribbean cruise?

MR. LITT: Objection; misstates the evidence.

THE COURT: He is asking a question. Which is your

2887

problem, when he put it in the dispatch?

MR. LITT: No. The dispatch that he is referring to doesn’t say what he says it says, and he is asking a question saying that it says it.

THE COURT: Well it is probably compound.

MR. FLYNN: Can we have the dispatch, Your Honor?

THE COURT: Do you have a number on it to identify it? We have got a few exhibits here.

MR. FLYNN: May we also have the plaintiff’s 29, 30 and 31? It is exhibit T.

THE COURT: Are you talking –

MR. FLYNN: I am sorry, it is 500.

THE COURT: We will take a 10-minute recess. (Recess.)

2888

THE COURT: We are back in session.

The witness has retaken the stand. State your name again for the record, sir. You are still under oath.

THE WITNESS: Gerald Armstrong.

THE COURT: You may continue, counsel.

Q BY MR. FLYNN: The Dive Bomber letter of 11 February, 1980 marked as 500-DD, Mr. Armstrong, indicates that Mr. Hubbard received the money from Warner Brothers that you previously testified about just prior to shipping out for the South Pacific as a Naval officer when he was closing up his New York Riverside Drive posh apartment; that would be sometime in late 1941; is that correct?

A Yes.

Q When was Dive Bomber supposedly written by Mr. Hubbard?

MR. HARRIS: Per that exhibit, Your Honor?

Q BY MR. FLYNN: To your knowledge.

THE COURT: Based upon your review of everything that you have reviewed.

THE WITNESS: The only thing I found regarding Dive Bomber was a — something that appeared in a pulp magazine some years before. And I believe it was 1936 or 1937. It was not — the Warner Brothers Dive Bomber, I believe, came out — was released in 1940. That is what I know about it.

Q BY MR. FLYNN: All right. Now, how much money had Mr. Hubbard stated that he had received for writing the screen play for the movie Dive Bomber?

2889

MR. HARRIS: Again, in that exhibit, Your Honor, or just from general knowledge of the witness?

Q BY MR. FLYNN: What was your understanding, Mr. Armstrong?

A Well, there was — a tape, a lecture, in which he said he had received $10,000.

2890

Q Now did you go through the letters to Mr. Hubbard’s first wife to ascertain his financial condition based at least as set forth in those letters between 1937 and 1945?

A Well, I never went through this specifically to find that out. However, I was able to pretty well ascertain his financial position throughout that period from those letters.

Q And from letters, what was your understanding as to what Mr. Hubbard’s financial condition was during that period when he supposedly received the $10,000?

A Well he was continually claiming that he was broke or near broke throughout that period.

Q And did you find that to be inconsistent with his claim that he had received $10,000 and closed up a posh New York apartment as set forth in exhibit 500 double D?

A Yes.

MR. HARRIS: Just so we are clear, Your Honor, the $10,000 does not appear in exhibit double D.

THE COURT: All right, it speaks for itself.

Q BY MR. FLYNN: Now is there a letter under seal from Mr. Hubbard’s father which sets forth where he was basically and what he was doing between 1925 and 1929 before attending George Washington University?

A I don’t know if all those years are included in that, but there is a letter from Harry Hubbard regarding where Mr. Hubbard was; that is, L. Ron Hubbard was during at least some of that time.

2891

Q And does that letter indicate what schools Mr. Hubbard had attended and what instruction he had received or tutelage he had received from his mother?

A I don’t know if all the schools are included in there or not. There is a description of what he had done and the reason why his school record was what it was.

Q Now, Mr. Harris showed you what has been marked exhibit 62. It is not under seal, I understand, and you recognize that to be a journal of Mr. Hubbard; is that correct?

A Yes, it contains, I believe, two things in there; journal notes and then what appears to be fiction notes.

Q Now, in the various biographies of Mr. Hubbard, it was your understanding that he had claimed that between the years 1925-1929 he was “traveling throughout Asia absorbing the wisdom of the East” as set forth in many of those biographies? is that correct, Mr. Armstrong?

A Basically, yes.

2892

Q And you found that he had gone on a two-week YMCA trip to China; is that correct, at one point?

A Yes.

Q Now, directing your attention to the last page of exhibit 63, the journal, did Mr. Hubbard make a notation as to some of his observations about China?

A Well, there’s one observation. I don’t know if the first one refers to the Chinese, but very possibly because there are similar comments elsewhere.

Q And this comment was, Mr. Armstrong?

A “The trouble with China is there are too many Chinks here.”

Q And how old was Mr. Hubbard at the time?

A He would have been about seventeen and a half.

Q And this is when he had flunked out of two high schools at this point; is that correct?

A I don’t know about the second one. I have heard that. But the one, yes.

Q And what was your state of mind when you read that with regard to Mr. Hubbard absorbing the wisdom of the East?

A Well, that tied in with the description of the Llamas as voices sounding like bull frogs. It just did not agree with the picture of studying underneath Llama priests in Tibet and in India and what appears in the mini-biographical sketches to be a period in which he completely immersed himself in the Eastern philosophy; just was not the case.

Q Now, you were questioned about wage vouchers

2893

that you had received from the church of Scientology of California. You had testified previously in this case that you didn’t receive any wage vouchers; do you recall that, from CSC, from the Church of Scientology of California?

A Okay.

Q Did you make a mistake in that testimony?

A Obviously.

Q Had you previously testified in a deposition that you had some memory of receiving some wage vouchers from the Church of Scientology of California?

A Well, that I had a memory of something to that effect. That would have been the only period as far as I know when I might have gotten a wage voucher from the Church of Scientology of California. And even then I wouldn’t have paid that much attention to it. But something like that came up in a deposition as to who I was working for at some given time.

Q Now, for the bulk of time while you were in the organization you received blank wage vouchers as you have testified; is that correct?

A Yes.

Q And you went through all the organizations that were the cover story such the Friends of Norton Karno; the Scottish Highlands Quietude Club; the OTC; the Friends of Mr. Schneider’s Uncle; do you recall all that?

A Yes.

Q Now, the ones that you received from Church of Scientology of California marked as exhibit 54 were in 1977;

2894

is that correct, for the most part?

A Yes.

Q Now, at that time, Mr. Armstrong, where were you?

A I was in the RPF in Clearwater.

Q And was that one of the few periods throughout your stay in Scientology other than 1980-1981 when Mr.
Hubbard left that you were away from Mr. Hubbard?

A Yes — well, there was a period of time in 1972 and part of 1973 when Mr. Hubbard was gone from the ship. So I was not in direct communication with him then, but the rest of the time, ‘71 through ‘75 — ‘70 — this would have been the only period of time, yes.

2895

Q And when you were on the ship, you were employed by OTC; is that correct?

A Yes. At one level, yes, employed by them.

Q Now you were in the RPF in 1977 in Clearwater; is that correct?

A Yes.

Q And thereafter when you rejoined Mr. Hubbard at Gilman Hot Springs and at La Quinta, you received blank wage vouchers; is that correct?

A Yes.

Q In general, Mr. Armstrong, what was your state of mind while you were in the RPF?

THE COURT: About what?

Q BY MR. FLYNN: In retrospect, how do you view the state of mind that you had at that time?

MR. LITT: Objection; ambiguous.

THE COURT: Well, I suppose he could spend a week telling us about all the different ideas that he had at different times during that year and a half or whatever it was. Maybe you could be a little more specific, Mr. Flynn.

Q BY MR. FLYNN: Did you feel that you were in a very degraded condition at that time, Mr. Armstrong?

A Yes.

Q And that was when you were undergoing the list one rock slam project sec checking?

A The list one rock slam project sec checking began the beginning of ‘77 after I had been in the RPF, I guess about six months at that time. The whole experience

2896

was degrading.

Q Now, you were questioned about a letter that you had written to, I believe it is, Gale Irwin relative to your wife Joscelyn becoming involved in illegal activities; do you recall that?

A Yes.

Q And Mr. Harris questioned you about that letter, and that letter has been marked as exhibit double H. Mr. Harris questioned you about lies that you had told and testified about prior to writing that letter while you were in the organization; do you recall that?

A Yes.

Q Now, in 1980-1981 did you have a developing awareness of the illegal practices of Mr. Hubbard and the Church of Scientology?

A Yes.

Q And as that awareness developed, were you making an effort to resist those illegal practices?

A Yes.

Q And at that time did you feel that you had tried to resist the illegal practices in the past, but in some cases you didn’t and in some cases you did?

A Yes.

Q And what was your state of mind, Mr. Armstrong, in 1981 when you wrote that letter with regard to what you had seen the organization lie about, what you had tried to resist and what you had been involved in?

A Well, 1 had throughout that period — it had

2897

become increasingly apparent to me that the organization had for years been involved in illegal activities and that I had contributed to those illegal activities, which hadn’t resulted in anything decent, any furtherance of civilization or helping mankind at all.

2898

And I became increasingly aware that it didn’t make any sense. And when my wife was asked to do these things and she was not knowledgeable of what was illegal or legal and nor was I, I was put in positions continually, asked to do things which were illegal or borderline illegal or at least shady.

And I had seen that the top 11 Guardian Office personnel had been convicted by this point. And the organization had completely turned against them and was carrying out the PR line that they were operating independently.

Hubbard had — it had come up right at the beginning with Omar Garrison where Omar Garrison had been continually asked when he did a tour for the book “Playing Dirty,” he was continually asked the question as he related it to me, “Why did Mr. Hubbard, why did this guy let his wife take the rap?”

And I saw that the organization had deserted these people; that they claimed that they had acted independently; they had turned them into scapegoats. And I saw that the same thing would happen to anyone within the organization who did something illegal for Mr. Hubbard; that he later would not be around and the person would individually take the rap. And I thought it was unjust, unfair. And I didn’t want to do it.

Q Now, you were shown by Mr. Harris exhibit 39 which is Flag order 3395, “Regulations and Laws Obedience 2.”

Now, that is dated 27 October, 1973; did you

2899

see that on board the ship, Mr. Armstrong, that exhibit?

A Very likely; either this or something really similar.

Q Now, does that exhibit reflect what in actual practice took place on board the ship with regard to obeying the laws?

A This was a policy which was to be obeyed whenever possible. And if you didn’t obey it, then the rule was don’t get caught.

Q Was that in itself a shore story?

A Yes. This — the whole idea, there are contradictions of this exact thing in one of the policies often quoted by Scientology called the “Simon Bolivar Policy.” In which it lays down a completely different picture.

Q In the various — well, the assistant Guardian’s Information Full Hat, in the training procedure set forth in there that were in the Port Captain’s office in 1974, were these contrary to that policy?

A Well, it is very possible. This was published when I was on the ship and — yeah, I am pretty sure that I saw it at the time, uh-huh.

Q Now, what was your state of mind at that time with regard to whether or not Mr. Hubbard was promoting corporate integrity?

A Well this period of time is a bit confusing to me, and it is confusing because I was believing in the man and I was believing in his integrity, and it looked like corporate integrity should be a part of that whole Scientological view of integrity. But this whole policy here is a sham.

The perception I began to have about corporations in Scientology was simply that they were used as covers of various sorts, and I even walked away from Scientology with the idea that all corporations were means of carrying out fraud and that is what this is.

Q In 1980-1981 when you collected the documents in the archives project that related to various Scientology corporations over a period of 30 years, did you develop a state of mind as to whether or not there had been any corporate integrity in any Scientology corporations based on the documents that you had seen?

2901

A I knew there was absolutely none. I knew that the — that that was the — what had been the case. It was this reason that MCCS got started. It was apparent to anyone in the organization who had anything to do with the legal activities of the organization. They knew that the board of directors were figureheads. They had no power whatsoever, and that the whole thing depended on L. Ron Hubbard and his authority.

Q Now you had previously testified that in your mind the documents that are under seal are replete with dishonesty and dishonest practices by Mr. Hubbard; is that correct?

A A lot of them, yes.

Q And are you familiar with a phrase of Mr. Hubbard’s that “honesty is the road to sanity”?

A Yes.

Q And you did a “Success Story” marked exhibit 53 for the RPF; is that correct?

A Yes.

Q And you have testified already about the practice of success stories being required and in the last sentence you state, “And to LRH who has given me my sanity and given me the tech with which to help him in his goals for man.”

Q And in 1980-1981 when you collected these several hundred thousand documents that are under seal that revealed these dishonest practices of Mr. Hubbard, did you consider that the road to sanity was for you to correct that dishonesty?

A It has been a big part of my action from 1980 onward.

The man said that if you allow someone to be dishonest, you set him up to be physically ill and unhappy.

L. Ron Hubbard is physically ill and he is unhappy. And that is because each one of us inside the organization allowed him to be dishonest and to rip us off and to rip off hundreds of thousands of people for millions of dollars for many years.

Q And you were asked a series of questions by Mr. Harris about Tanya Burden; do you recall that?

A Yes.

Q You wee shown an affidavit that you signed on April 12, 1980 which has been marked as exhibit 48 in this case. And you testified that that was signed for the organization to assist in the defense of the Burden case; is that correct?

A Yes.

Q Now, is that statement accurate, Mr. Armstrong?

A No.

Q And was Miss Burden required to sign nondisclosure and release bonds and promissory notes and given, for example, a $61,000 bill for undergoing RPF in Clearwater?

2903

A Undoubtedly.

MR. LITT: Objection. Move to strike as a conclusion.

THE COURT: I’ll strike it as a conclusion of the witness.

MR. FLYNN: I would like this exhibit collectively marked as next in order, Your Honor.

MR. HARRIS: May I have one? What is it?

Q BY MR. FLYNN: Miss Burden was with you in the RPF in Clearwater; is that correct?

A Yes.

Q And then you went and picked her up in Las Vegas and took her to Los Angeles; is that correct?

A Yes.

Q And you turned her over to the RPF in Los Angeles; is that correct?

A Yes.

Q And do you know whether she was sec Checked in Los Angeles?

A I never attended the Sec Check. I understand she was.

I turned her over with the intention that she be — I know she was audited. And I assumed she was Sec Checked.

MR. LITT: Objection, Your Honor.

Q BY MR. FLYNN: Now –

MR. LITT: Just a moment, please, Mr. Flynn.

Your Honor, I would move to strike the answer. The witness did not state that he has any personal knowledge.

2904

And the question called for his personal knowledge.

THE COURT: He said that he knew she was audited.

I’ll strike whatever he said afterwards as an assumption that he might have of some experience based upon personal experience on that subject.

2905

Q BY MR. FLYNN: Was it your understanding that she was taken to Los Angeles to be sec checked, Mr. Armstrong?

A Yes.

Q And it was your orders to go pick her up and take her there; isn’t that correct?

A Yes.

Q And do you recall whether it was on or about December 17, 1977 that she was taken to Los Angeles and security checked?

MR. HARRIS: Again that assumes a fact not in evidence.

THE WITNESS: I don’t recall the date, whether or not it was December 17th or not.

Q BY MR. FLYNN: Was it December 1977?

Q Now you had been on the ship with Miss Burden; is that correct?

A Yes.

Q And how old was she on board the ship?

A She was just a little girl then, maybe — boy, 14, 15.

Q And based on your observations, what were her duties?

A Well, the main duties that I saw, she was cleaning senior, CMO personnel’s rooms, taking care of their laundry, and she also was a junior watch messenger which meant that she worked one of the watch shifts as a messenger for Mr. Hubbard.

Q And do you know of any personal services she gave to Mr. Hubbard such as dressing him in the morning?

2906

A I would not have seen that. I did see her with him a great deal and would have seen personal service, but not the dressing part.

Q Based on your observations, when she was working as a junior watch messenger, approximately how many hours a day, how many days a week was she working?

A Just on watch or the whole range of work?

Q The whole range of work.

A She would have put in a very long day. I can’t tell you exactly the hours, but she probably worked 12
hours a day, studied a couple of hours a day.

Q And how many days a week?

A Well, if she was good and her stats were up, she would have gotten a day off every two weeks.

Q And how much was she receiving in pay per week for the Operation Transport Corporation for those labors?

A During the period of time when Tanya was on board, I believe we began to be paid $17.20 a week. I am pretty sure that is what it was.

Q Now you have testified previously that there was a practice of retaining personal belongings when a person left the organization?

A Yes.

Q And do you know whether Tanya Burden’s personal belongings were kept?

A I don’t have personal knowledge of that.

Q And the practice of signing nondisclosure and release bonds when a person tried to leave the organization?

2907

A It was standard.

Q And a practice of signing promissory notes to the organization?

MR. LITT: What is the question?

Q BY MR. FLYNN: Were you aware of that practice, Mr. Armstrong?

A Yes.

Q And do you know whether or not Tanya Burden on December 17, 1977 in Los Angeles signed a $50,000 promissory note to the Church of Scientology of California?

MR. LITT: Objection. Mr. Flynn is asking questions which he does not expect his own client to have the answer, to essentially have himself testify.

Mr. Armstrong has said he doesn’t know.

THE COURT: Well we got into this problem with this declaration and then testifying to the truth or at least it is averring that what was there was — the declaration says it is all true, and now he says it wasn’t. He is bringing out other evidence relative to it.

I don’t know whether the witness knows about it or doesn’t know about it. Overruled.

Q BY MR. FLYNN: Was there a practice of signing promissory notes and retaining personal belongings of people who tried to leave?

A Yes.

MR. LITT: Objection; asked and answered.

2908

Q Was there a practice, Mr. Armstrong, of sending bills to people who tried to leave?

A Yes.

Q And was there a practice of locking people up who tried to leave?

A Yes.

THE COURT:How old was this girl in ‘77?

THE WITNESS: She — I think she would have been about — 17 then, maybe 16 or 17. She was quite young.

Q BY MR. FLYNN: And when you left the organization, Mr.Armstrong, did you make an effort to avoid all of those practices?

A Yes.

MR. FLYNN: That is all I have, Your Honor –

THE COURT: Mr. Litt.

MR. LITT: Thank you, Your Honor.

THE COURT: Did you want this marked, Mr.Flynn?

MR. FLYNN: I would like to have it marked as next in order, Your Honor.

THE COURT: Okay. XXX.

RECROSS-EXAMINATION BY MR. LITT:

Q Mr. Armstrong, you testified yesterday concerning some pictures; do you recall that?

A Yes.

Q And you said that in your experience within Scientology, that there were only certain pictures that were

2909

approved for public use. I am referring to pictures of Hr. Hubbard; is that correct?

A For publication.

Q When you say “publication,” do you mean carrying — reprinting then?

A Yes.

Q Putting then in any magazines, whatever?

A Yes.

Q And I believe you said that there were about 12 such type photographs?

A Yes, something like that. There was 12 approved at one point and then another couple of color prints were released. And that is what there was.

Q Now, I gather you had some pictures that were taken of your wedding on board the Apollo, your wedding to Terri Gillam; that is her name then?

A Yes.

Q and these pictures, how did they get taken? Who took them?

A Well, they were taken during the wedding and after. Some of them were taken by Mr. Hubbard and some of then were taken — I know the name Chris Potter has come up. And it is very likely that it was Chris Potter.

There may have been a second photographer as well, but in any case, they were taken during the wedding ceremony.

Q And this was on board the Apollo itself?

A Yes.

2910

Q And in addition to pictures of Mr. Hubbard, were there pictures of other people who were on board the ship?

A Yes.

Q And were there other occasions on which photographs like this were taken?

A Yes.

Q Now, this was at a time, as I understand it, that the activities of the Apollo, as you described it, was not to be publicly known as Scientology; is that right?

A By whom?

Q By persons other than within Scientology.

A Okay.

Q Wasn’t that your testimony?

A Well, in 1974, the shore people were not told that; correct?

Q I don’t know. I’m asking you.

A I’m saying that is the way it was.

Q Now, these pictures that got taken, the ones of your wedding, I take it that a gift was made to you of a set of these photo albums or a gift was made to you and your wife Terri?

A Yes.

Q Was there more than one set of photo albums that was made a gift to you?

A Well, no; just one.

Q Was that the one that you later tried to sell?

A That is correct.

2911

Q And had you sent those pictures to your parents as a portrait of your wedding?

A That is correct.

Q Now, when pictures were taken in settings like this, they were for private use; is that correct?

A Okay.

Q Okay means yes?

A There wasn’t any particular rule set down on it.

Q But your understanding was that they were for private use; correct?

A Yes.

Q It was your understanding that they were not for publication; isn’t that correct?

A That is correct.

Q And the photo album that you had that you tried to sell had been given to you for personal use and not for public dissemination; isn’t that correct?

A That is correct.

Q Now, the Douglas’ pictures that we have talked about, you said that they were pictures, that part of them were also taken of a wedding on board the ship; right?

A Yes.

Q And these pictures also had within them some activity that came not in 1974 but substantially later; is that right?

A The beginning of 1980.

Q And were these pictures of some kind of a party

2912

or something like that? I wasn’t sure exactly what your testimony was.

A There are party pictures; that is, pictures taken at a table. I believe it is January 1st or the New Year’s party or something to that effect.

Q Were you present at that party?

A No.

Q And there were various pictures from this party that were taken?

A Yes.

Q And that was the other half of the set of photos from the Douglas’?

A I don’t recall if there is a half, but –

Q Other part?

A Portion, yes.

Q And you indicated that there was one picture of Mr. Hubbard with a croupier’s hat?

A Yes.

Q And I take it there were pictures of other people who were present at this private party in addition to Mr. Hubbard?

A In some of the pictures, yes.

Q Now, you indicated that one of the — by the way, were the Douglases on staff when these pictures were taken?

A Mr. Hubbard’s staff?

Q Whatever staff they were on, Scientology staff; right?

2913

A They were Scientologists. They were working for Mr. Hubbard.

Q They were out at Gilman Hot Springs?

A No.

Q Were they out at Gilman Hot Springs at the party where the pictures were taken?

A No.

Q Do you know where the pictures were taken?

A In Hemet.

Q If I remember your testimony right, you indicated that one of the reasons you believed that the pictures were taken by whoever they were taken by, which I am not clear on because they showed a picture of Mr. Hubbard gambling; is that right?

A That could have possibly been a motive. I really — I have wracked my brain to try and come up with something that makes a lot of sense, so I have a lot of motives in my mind. That is a good chance.

Q And that was because, as I understand your testimony, that there was a policy against gambling and this picture showed Mr. Hubbard gambling; is that your reasoning process?

A Basically, yes.

Q Now do you have any information about the circumstances of this supposed gambling activity at this party?

A Some.

Q Are you aware whether, in fact, it was not gambling at all, but whether or not Mr. Hubbard provided money

2914

to people to engage in what was a pretend activity of gambling as a party activity?

A I believe so.

Q But nonetheless, it is your feeling that because there is some policy against gambling, that this would be highly embarrassing or something to that effect; is that right?

A Well it stay have been embarrassing. For some reason, the people deemed it necessary to take the photos.

Q Tell we about this policy against gambling. Is there a Scientology policy that prohibits gambling?

A There is a policy or a technical bulletin called “The Gambler.”

2915

“The Gambler” was a — it was a psychosis, gambling.

Q So as I understand it, there is a policy letter — I take it this policy letter was written by Mr. Hubbard?

A It is a technical bulletin, yes, by Mr. Hubbard.

Q And in this policy letter Mr. Hubbard says –

THE COURT: He makes a distinction between a policy letter and a bulletin, counsel.

MR. LITT: I stand corrected.

Q In this bulletin, Mr. Hubbard says that gambling is a psychosis; is that right?

A Something to that effect. I don’t have it here with me, but you get the idea that the gambler is a — not a particularly desirable characteristic.

Q Mr. Armstrong –

May this be marked Plaintiff’s next in order, Your Honor?

THE COURT: All right. 70.

Q BY MR. LITT: Is this the bulletin that you are referring to?

A Yes.

Q And the first sentence of this bulletin says, “. . .an obsessive gambler is a psychotic just like a drug addict or an alcoholic”; is that correct?

A That is correct.

Q Is that the policy that you are referring to that prohibited the type of gambling which would be exposed from

2916

this activity at Hemet on New Year’s Eve?

A I think you have completely misinterpreted everything I have said, Mr. Litt.

Q That’s fine.

Is that the bulletin you are referring to?

A This is the bulletin about the gambler.

Q Fine. Now, was it your understanding that the photos taken at this New Year’s Eve party, just like your own photos, were private photos taken for private use?

THE COURT: What are private photos?

A photo is a photo.

A person taking a picture, they have a negative unless it is a Polaroid.

Is there anything about it that is stamped upon it that says it is private and can only be used privately forever ever after?

MR. LITT: I’m going to Mr. Armstrong’s state of mind as to whether or not –

THE COURT: He wasn’t there.

MR. LITT: I understand that.

THE COURT: You can ask him whether or not Mrs. Douglas told him something.

Is that who you got the photos from?

THE WITNESS: Those are the Douglases, yes.

Q BY MR. LITT: Let’s go to the Dincalcis’ photos. These were taken, you said, in New York in 1973?

A Yes.

Q Now, this was when Mr. Hubbard was with — was

2917

with both Jim Dincalci and his wife, or just with Jim Dincalci in New York?

A With Jim Dincalci.

Q Was anybody else with Mr. Dincalci at the time?

A Yes.

Q Do you know who that was?

A Paul Preston.

Q Were they the only two people that were traveling with Mr. Hubbard at the time?

A Yes.

Q And were they, to your knowledge, acting as personal aides to Mr. Hubbard?

A Yes.

Q And do you know anything about the circumstances under which those pictures were taken?

A Only what Jim Dincalci told me.

Q You weren’t there?

A No.

Q And I believe you testified that the — that you believed that one of the reasons that these photos would be taken was because they showed Mr. Hubbard being in New York in 1973?

A Well, that is a logical reason.

Q That was your conclusion as to one reason; correct?

A Yes.

I have not concluded as to why they were taken. Ultimately I just see it as an example of the Fair Game

2918

Doctrine. But this is within the organization’s mind how they are justifying these — the theft of the photos.

Q You testified as to your conclusions or your opinions, didn’t you, as to why these were taken? Do you remember that?

A As regard to what is in their minds.

Q I understand that that is what you were doing. And I believe you said Mr. Hubbard’s location was secret while he was in New York and in your opinion this was one of the reasons that the, “organization wanted to take the photos”; is that correct?

A It is possible, yes.

Q Are you aware that there has been substantial testimony in a variety of cases well before this incident concerning where Mr. Hubbard was in 1973 including the fact that he was in New York?

A No.

Q Are you aware — I believe you also testified that it was your opinion or your conclusion that another purported reason for taking these photographs was that it showed Mr. Hubbard in Hemet or in Gilman Hot Springs or in the desert at the beginning of 1980; is that correct?

A No. What I stated was I thought later of a possible reason and that being that at the beginning of 1980 there is a great number of people identifiable as with Mr. Hubbard. And I don’t think I went into the location because it wasn’t in the desert. It was in Hemet. And the possibility that the organization seeing this thought that

2919

it was somehow compromising or it was a contradiction of what was being put forward throughout that period; that no one had seen Mr. Hubbard and no way of contacting him.

2920

Q And do you have any knowledge about whether there’s been substantial testimony prior to this incident concerning whether or not Mr. Hubbard had been in such location at that time?

MR. LITT: In any Scientology cases. The theory is that these things are some major secret, I suppose.

MR. FLYNN: Substantial testimony by –

THE COURT: It seems to me that it is nitpicking. He is just trying to speculate, according to him, why they took them. He is saying this is a possible basis. He is not saying that is the reason. He is saying it is possible. It may not be right. It doesn’t contradict his testimony.

MR. FLYNN: Is there substantial testimony as to where Mr. Hubbard is now?

THE COURT: I don’t know. That is from left field. Let’s go back to the case.

MR. LITT: May I have –

THE COURT: If we are going to get into those, let’s take a recess because that will take some time. We will reconvene at 1:30.

(At 11:56 a.m. the luncheon recess was taken until 1:30 p.m. of the same day.)

2921

Los Angeles, California; Wednesday, May 23, 1984; 1:30 p.m.

THE COURT: We are back in session.

The witness has retaken the stand.

State your name again for the record, sir. You are still under oath.

THE WITNESS: Gerald Armstrong.

THE COURT: You may continue, Mr. Litt.

MR. LITT: Thank you, Your Honor.

GERALD ARMSTRONG, the witness on the stand at the time of the recess, having been previously duly sworn, resumed the stand and testified further as follows:

RECROSS-EXAMINATION (Resumed) BY MR. LITT:

Q Mr. Armstrong, Mr. Flynn showed you a picture that he asked you to state whether or not it looked like one of the Dincalcis’ pictures that has been marked as an exhibit; do you know what I am referring to?

A Yes.

Q Is that a picture which is a copy of a picture which was sold at some point by Mr. Dincalci and published in Time magazine? Do you know?

MR. FLYNN: Compound, Your Honor.

THE COURT: Sustained.

2922

Q BY MR. LITT: Do you know whether that picture was ever published in Time magazine?

A I don’t know if that particular one, but possibly one of four magazines — one of four photos. And I don’t recall now which one, but –

Q Mr. Dincalci sold several photos to Time magazine?

MR. FLYNN: Objection. Sold?

MR. LITT: I’m asking if he knows.

THE COURT: If you know.

THE WITNESS: I don’t know of any sale to Time magazine of any photos.

2923

Q BY MR. LITT: You only know that he provided photos to Time Magazine?

A It’s possible that I provided them.

Q Okay. And from among those photos at least one was published in Time, do you know that?

A I don’t at this moment, but if it’s a similar photo, then it is very likely that ti [it] came from the four.

Q You testified on redirect concerning a list of lawsuits that had been provided you by Ann Mulligan. Do you recall that?

A Yes.

Q Was that a list of current lawsuits involving the Church of Scientology of California, or other Scientology organizations?

A Yes.

Q Was Robert Kaufman’s name on that list of current suits?

A No.

Q So when you looked at that list you didn’t see anything about Robert Kaufman?

A No. I knew about Kaufman from some time previously.

Q And anything having to do with Robert Kaufman had occurred in the period 1970-1971; is that correct?

A I don’t know the year, but I knew that it was in the ’70’s.

Q In the early ’70’s?

2924

A Most likely, yes.

Q Now, you also testified that processing is auditing; is that correct?

A That is correct.

Q Are you aware whether or not Mary Sue Hubbard, prior to the time she became Guardian, had ever held the position of Director of Processing?

A She very likely did.

Q Do you know what term was used in 1969, at the time that Guardian program order 121669, concerning which you have testified — Do you know what the term processing file meant at that time?

A I know what processing was at that time.

Q But you don’t know what the term processing file, as opposed to preclear folder, meant at that time; is that correct?

A If someone had asked me about a processing file at that time, I would have known they were talking about a preclear folder.

Q Do you have any information concerning whether or not in 1969 there were separate administrative files kept concerning financial records or other records which were not part of a preclear folder, which were kept separate from preclear folders within the office of Technical Service? Do you know anything about that?

A No.

Q So you do not know what the term processing file meant in 1969; is that correct?

2925

A Well, a processing file in 1969 would have meant preclear folders.

Q Do you know that of your own personal knowledge?

A Yes.

Q And what is the basis of that knowledge? Were you ever — Let me put it like this. You worked in a franchise, you called it, in the years 1969 and 1970?

A Yes.

2926

Q You were not participating at this time in any Church of Scientology designated as a church?

A That is correct.

Q Do you have any personal knowledge concerning the designations given to processing files as opposed to pre-clear folders within various Churches of Scientology within the year 1969?

A Nothing other than what I have said.

Q You also testified on redirect that after this incident with the photographs occurred, that you had discussions following the incident with various people in which certain Scientologists took the position that the photos of the Dincalcis or the Douglases did not belong to them; is that correct?

A That is correct.

THE COURT: That is ambiguous. But maybe he understood it.

When you said “them,” I don’t know whether you meant the church or –

MR. LITT: No. I meant the Dincalcis or the Douglases.

THE WITNESS: That has been stated a number of times.

Q BY MR. LITT: Do you remember — when did you have the first such discussion, let’s take starting in May, 1982, with somebody on that topic, a Scientologist.

A Do you mean following the photo incident itself?

Q Yes, after.

A Following the discussion in which the same subject came up?

2927

Q Following the discussion that occurred at the CMO that you have testified.

A Right. Okay.

Q Subsequent to that.

A Yes. The next direct discussion was there was a radio show somewhere out in Boston, I believe. And I was contacted by the people putting on the radio show. And there was someone there from the organization. He –

Q When was this?

A I couldn’t give you a –

Q Roughly.

A Probably a year and a half ago.

Q That was in 1983 or late 1982?

A It could have been the beginning of ‘83; it could have been the end of ‘82.

There was a communication with a –

Q I am not asking for the contents. I am just asking you for the events.

Now, after this radio show when else did you have a discussion with someone, this event?

A There was — not long ago here outside in the hallway.

Q Is that in the context of this proceedings?

A Well, it was a Mr. Sandy Block.

Q That was within the last couple of months?

A That is correct.

Q You also testified on redirect concerning getting some financial materials from the church at a certain point;

2928

was that in February of 1982 when that occurred?

A It very likely was February. It could have been the end of January. It was whatever date I went in to locate some materials for Vaughn Young that Mr. Garrison had requested.

At the same time I took the opportunity to pick-up this file of my financial records.

Q Now, this file, was that still in the archives area? Is that where you found it physically?

A Yes.

Q And I believe you had testified earlier at some point that at the time of that visit you had had a couple of hours’ conversation with either Vaughn Young or him in combination with other people; is that right?

A No. I don’t think I was there a couple of hours. I met with Vaughn on two occasions. One of them was this time when I went in at Omar Garrison’s request.

The other one was — I think it was prior to that. And it was at lunch. I don’t think I was in the organization more than half an hour, the time I located the materials. It may be an hour, but it wasn’t a long time.

Q And these materials, were they still in the same place where you had left them?

A Yes.

Q And that was in some file cabinet?

A Well, it was in a box, my own box on wheels.

Q And how big was the file, the file of financial materials that you took? Can you estimate its bulk?

2929

A It would be about, I don’t know, half an inch thick.

Q It had maybe 100 pages or more of materials?

A Something like that.

Q When you took these materials, who was there while you were getting them?

A Vaughn.

Q Anybody else?

A I don’t recall if there was or not.

Q Now, these were — when you left you took these with you; am I correct about that?

A When I left after this meeting?

Q When you left after this meeting.

A Yes.

Q These were among the types of Scientology materials that you would have had with you at the time that you left?

A Do you mean when I left that day?

Q No, when you — I’ll clarify the question. These were among the types of Scientology materials that when you left the organization, you would have had that you might have wanted to take with you?

A Well, I don’t have financial records when I left –

Q I understand.

A — the organization. I went back and got them.

2930

Q Did anybody try to stop you from taking them?

A No.

MR. LITT: Thank you. I have no further questions.

THE COURT: Mr. Harris.

MR. HARRIS: Thank you.

I didn’t get a copy of exhibit triple E. I want to ask the witness some questions about that.

MR. FLYNN: I think I had some copies made, if I can find them.

RECROSS-EXAMINATION BY MR. HARRIS:

Q Mr. Armstrong, what was your knowledge of Narconon?

A I don’t know what you’re looking for. You want me to give a whole description of Narconon?

Q Well, let me ask you this. Did you understand that Narconon was affiliated in some fashion with Scientology?

A Yes.

Q And at the time that you came to this understanding — Strike that. When did you first come to this understanding?

A Probably on board the ship.

Q And from the time that you were aboard the ship, to the time that you left the organization, you understood that it was associated with Scientology; right?

A That’s correct.

Q Referring to exhibit triple E, you said that the items on the right-hand side of the page meant, as I

2931

recall, enemy, traitor, and doubt; is that right?

A That’s correct.

Q And Narconon is the last item listed on exhibit triple E; right?

A How do you spell Narconon?

Q Is Narconon listed as the last thing on exhibit triple E, sir?

A Well, there is a Narconon there, but I think — I think this may be another separate organization. This is a different spelling from the Scientology Narconon, so maybe they were the competition.

Q Is that something you have knowledge of, as you sit there right now, Mr. Armstrong?

A Of the other spelling?

Q Yes, the other alleged organization.

A No. No, I don’t.

Q And it’s listed, this Narconon, as enemy, according to your terminology; right?

A It appears to be, yes.

Q Now, in addition to that, there is, on exhibit triple E, an item called Flynn Associates Management Corporation. Do you see that?

A Yes.

Q Had you ever heard of Famco before?

A Had I?

Q Yes.

A Had I?

Q Yes.

2932

A Had I before when?

Q Before your sitting here testifying today.

A Okay. I have heard of it, yes.

Q That is something with which you are familiar, Mr. Armstrong?

A My only familiarity comes from a set of documents which has been circulated by a private investigator working for the organization.

Q And did you learn about this Famco after you left the church?

A Yes.

Q And you know about it from some documents circulated by a private investigator, sir?

A Yes.

Q And have you looked at those documents?

A I have glanced at them.

Q Who is Joey Flannagan?

THE COURT: If you know.

THE WITNESS: Joey Flannagan. I’m not certain, but it may be — I have heard his name in connection with a deprogramming case, my best recollection, but I cannot be certain of that.

Q BY MR. HARRIS: Do you have any present knowledge of the relationship between Joey Flannagan and Flynn Associated Management Corporation?

A No.

Q Now, you said CIC was Combat Information Center?

A Well, it was used variously; Combat Information

2933

Center, Control Information Center.

Q And is this something that you had in the PRO office as well?

A Well, CIC in the PRO Bureau referred to the person in charge of the files. It was called CIC in that context and probably there it was not called Combat Information Center.

Q Is there some difference between Control Information Center and Combat Information Center, depending on what unit it’s in, sir?

A It is sort of like the difference between intelligence and information.

MR. HARRIS: I have a document, Your Honor, which is dated 3 May, 1960. May that be marked plaintiff’s next in order.

THE COURT: 71.

Q BY MR. HARRIS: I show you exhibit 71, Mr. Armstrong, and I ask you if you have seen that document before.

2934

A Yes, I have seen it.

Q The top page is something sent by you to the CIC person?

A Pers Bureau CIC International.

Q And attached to that is that person’s nonexistence formula?

A Nonexistence?

Q Yes.

A Yes.

Q And isn’t it true, Mr. Armstrong, that there were CIC’s in each of the major units of the church?

A What do you mean by “major units”?

Q Well, you had one for the personal PRO; correct, CIC?

A Correct.

Q And you have mentioned something about a B-l CIC which you called the Intelligence one; right?

A Okay.

Q And aboard the Flag ship the Apollo, you saw graphs on the bulkhead and elsewhere and you called that CIC; right?

A Yes.

Q And, by the way, when you were in CIC and observed these graphs, you did not understand, did you, that the graphs were intelligence activity graphs; right?

A More or less correct, yes.

Q Do you of other CIC’s? Yes or no.

A In the organization?

2935

Q Yes.

A Well, there was the CIC in Laurel’s PR Bureau. The CHO had a CIC. Those are what come to mind.

Q And, essentially, the CIC was a place where information was filed; is that correct?

A That was part of the action.

Q And in the CIC, any CIC, there was cross-filing; correct?

A I can’t speak for all CIC’s. But in that it was an information center, that is very likely the way they would have filed information, with a cross-file system of some sort.

Q Now, if I understood you on redirect yesterday, you said that if you had known that Scientology was a religion, you wouldn’t have joined; is that what you said?

A Yes.

Q And you also stated on your first day of cross-examination that you had read the Phoenix lectures before you went into the franchise; is that correct?

A I don’t know if I read it right then or around that time period. I definitely read it.

MR. HARRIS: I have a book, Your Honor, called “The Phoenix Lectures”; may that be marked Plaintiff’s next in order?

THE COURT: 72.

MR. HARRIS: I don’t know how quite I am going to mark it on there, but I’m going to put it on the inside cover.

Q Does this appear to be the book that you read,

2936

Mr. Armstrong?

A It appears to be the same.

Q And at the time that you read it did you understand that these — that the book was a compilation of lectures given by Mr. Hubbard in 1954 in Phoenix?

A Yes.

Q And the first three chapters of The Phoenix Lectures goes into the religious roots of Scientology; is that correct?

A Into — I am sorry. I didn’t get the last thing.

Q Let me ask you this: Do you recall when you read it Mr. Hubbard talking about the Vedic, v-e-d-i-c, Hymns?

A Yes. Something about that in here.

Q And about Buddhists writings?

A Yes.

2937

Q And do you recall reading the Phoenix Lectures once again for purposes of your biography project?

A Boy, I don’t recall that.

Q Did you use the Phoenix lectures in any way to prove or disprove that Mr. Hubbard was in Asia?

A No.

Q Would you please turn to page 34, Mr. Armstrong, and look at the second full paragraph.

Do you recall reading, in 1969:

“Scientology, then, today could not possibly be characterized as a science the way the Western world understands science. Scientology carries forward a tradition of wisdom which concerns itself about the soul and the solution of mysteries of life. It has not deviated.”

A Your question was whether or not I recall reading that in ‘69?

Q That’s correct.

A I don’t recall reading that specific thing. It’s possible.

Q And would you look at the bottom of page 34.

“Any work that I am doing or have done and that any Scientologist is doing has a tremendously long and interesting background. We are delving with and working with the oldest civilized factors known to man. Anything else is Johnny Come Lately. Scientology is a

2938

religion in the very oldest and fullest sense.” Do you recall that, reading that in 1969, Mr. Armstrong?

A Not specifically, but it’s possible.

Q Did you read any of Mr. Hubbard’s words in any of the published books with respect to your search for his Asian trips?

A I read a great number of them.

Q But you don’t recall reading the Phoenix Lectures for that purpose?

A No.

Q Now, on redirect examination yesterday Mr. Flynn asked you whether the items that had been marked for identification, particularly those having to do with sec checking, that was marked for the defense case, came from some published work. Do you recall that?

A Yes.

Q And he said to you, “We just put these together from a published work.” Do you recall that?

A That Mr. Flynn said that?

Q Yes.

A He may have.

Q And you said “Yes”?

Q Who is the “we” that Mr. Flynn was referring to, Mr. Armstrong?

A Well, it would include Mr. Flynn.

Q And who else?

A I really don’t know, but I think my wife did

2939

the collating and stapling.

Q And you say that these come out of the Green volumes?

A I believe that we could show you at least one. I don’t recall them all at this second. I believe there is three policies, and I think you will find them in the Green volumes.

Q Well, in fact, Mr. Armstrong, there are three ACOC’s and you can’t find them in the Green volumes; is that correct?

A Are you sure they are not policy letters?

Q Well, let’s take a look. May I have exhibit XX. (Pause.)

I will have to try a different one. Let me check my exhibit list. X, not double X. I have too many initials here.

Q Now, having been a Scientologist since 1969, Mr. Armstrong, you know that bulletins are published in the Red volumes; is that correct?

A That’s correct.

Q And would you look at the first page of exhibit X and tell me if that is a bulletin.

A That is a bulletin.

Q And the second full page, other than the E meter illustration, which we have agreed doesn’t belong here — Is that correct?

A Right.

2940

Q — the second one is an ACO bulletin as well; isn’t that correct?

A That’s correct.

2941

Q And the third one, a HCO policy letter; right?

A Right.

Q And did you take this policy letter, the third one, and this package X from the green volumes, Mr. Armstrong?

A I didn’t, but I have seen it in the green volumes which is what I said.

Q All right. So you picked two — you didn’t do it; right? It was your wife and Mr. Flynn?

A Apparently Mr. Flynn was the original source of these materials.

MR. FLYNN: I didn’t copyright them, though, Mr. Harris.

Q BY MR. HARRIS: Now, Mr. Armstrong, you testified yesterday on redirect that List-1 RS personnel could only audit other List-1 RS personnel. And the reasoning behind that, as stated by Mr. Hubbard, was so that these List-1 suppressives would not interrelate with the rest of the people on the RPF; do you recall saying that?

A No. I think the word was probably interbulate [enturbulate] the rest of the people.

MR. HARRIS: Mr. Flynn, yesterday, page 2,724, line 27 through the next page, line 3.

MR. FLYNN: I don’t have the luxury of having that, Mr. Harris.

MR. HARRIS: Perhaps I’ll share it with you and we can read it together, Mr. Flynn.

MR. FLYNN: Thank you. I’ll let you do it yourself.

MR. HARRIS: (Reading:)

2942

“List-1 RS personnel could only audit other List-1 RS personnel. And the reasoning behind that, as stated by Mr. Hubbard, was so that these List-1 suppressives would not interrelate with the rest of the more or less normal group of RPF inmates.”

MR. FLYNN: Your Honor, is Mr. Harris suggesting that that was what the court reporter correctly took down?

“Interbulate” is a Scientology term.

THE COURT: We corrected something of MR. Harris’ a few days ago.

Were you saying “interbulate,” or “interrelate”?

THE WITNESS: I used the word “interbulate,” ["enturbulate,"] Your Honor.

THE COURT: I’ll order it corrected.

MR. HARRIS: I have something entitled “affidavit.” Your Honor, may that be marked Plaintiff’s next in order, 73?

THE COURT: So marked.

Q BY MR. HARRIS: Showing you exhibit 73, Mr. Armstrong, would you look at the last page and see if that is your signature?

A Yes.

Q And would you look at each of the pages and tell me if your initials appear at the bottom?

A Yes.

Q And what is the date of this affidavit that you signed, Mr. Armstrong?

A 12 April, 1980.

2943

Q That is at a time when you were out of the RPF and within the archives project; right?

A That is correct.

Q And in the first paragraph you state under oath that you are a member of the Church of Scientology of California; employed by this church; is that correct?

A That is what I stated.

Q And you referred to the RPF being in the Church of Scientology of California in Clearwater in the second paragraph; right?

A That is what is written here.

Q By the way, when his Honor asked you about “Sir” in your communication to Mary Sue Hubbard, you indicated that that was the way you addressed her because it was a Sea Organization title?

A That is correct.

Q And it was true that you would address all people as “Sir” who were above you in rank whether male or female; correct?

A What do you mean by “rank”?

Q Well, did you understand that there were ranks within the Sea Org, Mr. Armstrong?

A Yes. But there were further distinctions made.

Q Well, would you address your senior as “Sir” whether or not a male?

A At one time.

Q Well, let’s take at the time that you addressed the communication to Mary Sue Hubbard.

2944

A Then I did.

Q And did you do that on the RPF as well?

A Well, in the RPP it was a different situation.

Q Well, did you state under oath, page 2, Mr. Armstrong: “re the rule where someone in the RPF must call every senior sir. This rule was not isolated only to the RPF, but has been a tradition in the Sea Org (a fraternal organization within the Church of Scientology) several years prior to the establishment of the RPF.”

THE COURT: Was there a question associated with that?

MR. HARRIS: Yes. I said did he state that. So he can read that and say whether he did or not.

THE WITNESS: That is here, yes.

Q BY MR. HARRIS: And on page 3, paragraph 10, you make reference to Ann Rosenbloom’s affidavit where she swore, “. . .I was given a twin and started my RPF auditing program. At this point I realized I was a List-1 RS’er. Because the person I was twinned with was a List-1 RS’er. According to RPF rules, only List-1 RS’ers could be twinned with List-1 RS’ers.”

You were referring to Ann Rosenbloom’s affidavit; correct?

A Yes.

2945

Q And then you said:

“I have personal knowledge of the activity of twinning list 1 RSers with list 1 RSers. I was the bosun of the RPF at the time, which is equivalent to executive director of an organization. I am familiar with the particular FO 3434 Ann Rosenbloom is referring to, and I know that this policy of twinning up list 1 RSers with list 1 RSers was never implemented, because I knew the reason for doing it was incorrect.

“I also know that Ann Rosenbloom wrote the above-mentioned policy.”

You stated that under oath, didn’t you, Mr. Armstrong?

A That’s correct, I did.

Q Now, I got from your redirect this morning that you claim that the affidavits that you signed contained lies; is that right?

A Yes, and perversions.

Q Lies and perversions, under oath?

A Yep.

Q And other than signing things under oath which were false, Mr. Armstrong, could you list for the court all the crimes that you committed while you were in Scientology.

A I will give it a shot. I stole things out of newspaper morgues. I smuggled things ashore in Morocco and Portugal. I lied to customs officials about what was contained in the materials that we had. I lied on bills of lading

2946

about what materials contained, about what they were.

I conned the officials in Clearwater about I disguised the fact that we were sleeping about 50 people in an unventilated storage room. I disguised the fact that we were sleeping about 50 people in a garage in Clearwater.

I allowed the organization to create a phony certificate announcing that I was the minister of the organization in order to get me into the United States because I was a Canadian citizen.

And I lied to the Immigration and Naturalization Consular people in Toronto regarding the same request for land and [landed] immigrant status.

That is what comes to mind.

Q And when you wrote to get your wife on the archives project, you said that you hadn’t –

“It is an area which I keep scrupulously legal — ” meaning the archives area — “this has been my modus operandi for all my Sea Org years, and on many posts closely connected with legal situations.”

You wrote that; right?

A Yes.

Q “I have always resisted attempts to get me involved in shady actions for short-range projects and opted for legality with long-range return.”

So you lied in that one too; is that right?

A Lied in what one?

2947

Q Lied in that statement.

A Which one?

Q The one I just read you.

A You would have to point out the lie, Mr. Harris. I didn’t hear it.

Q Well, I will try it one more time.

“It is an area which 1 keep scrupulously legal. This has been my modus operandi for all my Sea Org years, and on many posts closely connected with legal situations. I have always resisted attempts to get me involved in shady actions for short-range projects and opted for legality with long-range return.” You lied there; right?

A You will have to point to me, Mr. Harris.

Q You lied to your parents too; right?

A Yes.

Q Now, the Susan Meister incident that you talked about yesterday, you were a witness to what Mr. Flynn said was a killing aboard the Apollo?

MR. FLYNN: Objection, Your Honor. The word was not “killing.” I said she died from a gunshot wound to the forehead.

THE COURT: Well, it sounded like a homicide, accident-I don’t know.

Q BY MR. HARRIS: Page 2737, line 19.

“Q BY MR. FLYNN: Now, Mr. Armstrong, there was a person killed on board the ship in

2948

1971 shortly after you arrived, is that correct?” Your answer, Mr. Armstrong, was “Yes.” Do you recall that?

A Yes.

MR. FLYNN: Keep reading, Mr. Harris.

THE COURT: Just go ahead.

Q BY MR. HARRIS: In fact, Mr. Armstrong, the ship was in Safi at that time; is that correct?

A Yes.

Q And the local authorities investigated; is that correct?

A I believe so, yes.

2949

Q And you learned that it was a suicide; is that correct?

A I was told that at the time; that is correct.

MR. HARRIS: I have a document, “The Auditor Worldwide No.51?; Your Honor, may that be marked Plaintiffs next in order which I think is 74?

THE COURT: All right. 74.

Q BY MR. HARRIS: You did say, as I recall, Mr.Armstrong, that you had copies of “The Auditor” in your archives?

A My recollection is that I told you that there were copies there. I couldn’t tell you if it was a complete set, but that it is very likely it was.

Q All right. Showing you exhibit 74, do you recognize that as having been in your archives?

A No. But it possibly was.

Q And the last page of that, “What your fees buy” by L. Ron Hubbard?

A Okay.

Q Is that where you first saw “What your fees buy”?

A No.

Q What is the date of The Auditor Worldwide 51?

A This is copyright 1970.

Q Do you recall seeing “What your fees buy” in 1970?

THE COURT: I am not sure. Is that the same article that was in this brown sheet, or is it –

MR. HARRIS: Yes.

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THE COURT: The article, whether or not you saw it in that particular –

MR. HARRIS: That is correct.

THE WITNESS: I really can’t tell you when I first saw “What your fees buy.”

It is a very well known document in — or message from Mr. Hubbard in Scientology.

Q BY MR. HARRIS: All right.

A But I can’t tell you exactly when it was.

Q But you did testify that it was probably earlier than ‘76 which was the copyright date of the brown “What your fees buy”; is that correct?

A My recollection is, yes. I knew the phrase. And maybe it was, maybe it wasn’t. But it is something that I have known about for a long time. It is a rather famous writing.

Q Mr. Armstrong, when Mr. Hubbard, in your words, allegedly resigned as the executive director, what did you understand he was resigning from?

A Well, from control of the organization.

Q And did you understand that when Mr. Hubbard resigned the post of executive director, that he left management in the hands of a body called “The Executive Council Worldwide”?

A I have heard that story; in fact, there was something in the PR Bureau about when he resigned he was replaced by 150 people. So I understood that he had resigned and, according to the PR statement, been replaced.

2951

Q And did there come a time when you were aboard the Flag Ship Apollo that you found out that the Executive Council WW had been disbanded?

A Yes.

Q And you read that in an issue of some sort; is that correct?

A It is very possible. I think this is Reg Sharpe. When Reg was kicked out and Sea Org Mission came into WW and took over operations of WW.

Q Directing you –

Your Honor, I have a HCO policy letter of 31 August, 1971. May that be marked exhibit 75?

THE COURT: All right. So marked for identification.

Q BY MR. HARRIS: Showing you exhibit 75, Mr. Armstrong, do you recognize that as having come into your in-basket aboard the Apollo?

A It is possible that I read it back in August of ‘71.

Q And back in August of ‘71, Mr. Armstrong, did you understand that there was something called an Aides Council?

A In ‘71?

Q Yes.

A Well, there was definitely something called The Aides.

Q And was there a time when you learned that The Aides had gotten together as some group called Aides Council?

A They may have called themselves that. I was not

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familiar with the Aides Council.

Q And did you understand while you were aboard the ship after August of 1971 that the Aides were performing management functions?

A Yes. They did that.

Q And they had titles such as Commodore Staff 1, 2, 3, et cetera?

A yes.

Q And Commodore Staff 1 was over a particular division of what is called an organization board in Scientology?

A Yes.

Q and that meant to you by your understanding that that person could order in something in a Division 1 in any organization on the planet; right?

A Yes, except for, very likely, Guardian’s Office.

Q Well, there was a CSG which was Commodore staff Guardian?

A That is correct.

Q And when you are talking about Division 1, Division 2, so on, the Commodore Staff Guardian was responsible for the Guardian’s Office; right?

A Yes.

2953

Q And the other C dash a number were responsible for other functions within a church; right?

A Within the Scientology networks, okay.

Q All right. Within the networks. But, in any event, there were management activities going on in respect to those Commodore staff aides?

A That’s correct.

Q And then in 1980 there came a new executive director, Int; right?

A That could be ‘80, could be ‘81, I don’t –

Q And that is the Bill Franks that you mentioned; right?

A Yes.

Q Now, Mr. Armstrong, you mentioned that there was some sort of problem between the Guardian’s office and the CMO; do you recall that?

A Yes.

Q And that was occurring in 1980 and 1981; is that correct?

A Well, there had been a rivalry which had gone on as far back as 1975.

Q And it was your understanding that the CMO was going to do something about the criminals in the Guardian’s office; right?

A Well, I don’t know quite where you got that. Was that a statement of mind?

Q I just asked you if it was your understanding, Mr. Armstrong, while this turmoil was going on between the

2954

Commodore’s Messenger Org and the GO — whether it was your understanding that the CMO was going to kick the criminals out of the GO?

A I heard comments like that.

Q And people that were associated with the Guardian’s office, including Laurel Sullivan — Was it your understanding that their positions were being threatened?

A I don’t follow your question at all.

Q Well, did you feel that your position was being threatened by this Commodore Messenger Org attempt to get the criminals out of the Guardian’s office?

THE COURT: Well, I don’t think he has said that he is familiar with that. So it would assume something that he is not conversant with.

Q BY MR. HARRIS: You said, did you not, that it was your understanding or you had heard that the Commodore’s Messenger Org was going to get the criminals out of the Guardian’s office?

A Well, I heard a lot of statements made by CMO personnel about Mary Sue and the Guardian’s office.

Q Was it your state of mind, Mr. Armstrong, that– I think you testified on redirect that the organization just let those 11 Scientologists go without support?

A No, I don’t think that that is how I said it.

Q Well, did you, in your job, feel that the CMO was going to threaten it in some fashion, Mr. Armstrong?

A What’s “it”?

Q Your job.

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A Well, I felt threatened when CMO personnel Norman Starky ordered that I be sec checked regarding the biography project, so I felt threatened right then.

I felt threatened when I realized that the organization had — was attempting to change its spots, so to speak. The line about Mary Sue and her people was that they had caused all the problems, and that they were the criminals, and that they had brought all the problems on L. Ron Hubbard. That wasn’t the fact. They were just scapegoats.

Q And, Mr. Armstrong, at the time that you left the church did you have it in mind that you were going to write a biography of L. Ron Hubbard?

A When I left the organization?

Q That’s right.

A I was working with Mr. Garrison. I never thought that I would come close to doing a biography that he could do. I actually never considered doing a biography of Mr. Hubbard myself at all.

Q And to this day you haven’t considered that, Mr. Armstrong?

A I have considered doing something about these proceedings and the whole concept.

Q Have you told anybody, Mr. Armstrong, that you and Laurel Sullivan plan to write a biography of L. Ron Hubbard?

MR. FLYNN: I object, Your Honor. This is beyond the scope.

MR. HARRIS: Shows motive, Your Honor.

2956

THE COURT: Overruled. It is cross-examination.

THE WITNESS: Okay. I have never told anyone that Laurel and I were going to write a biography of L. Ron Hubbard.

Q BY MR. HARRIS: Did you tell anybody that you, Laurel, and Mr. Flynn were going to write a biography of L. Ron Hubbard?

A We have discussed — Mr. Flynn and I.

2957

MR. FLYNN: Objection, Your Honor.

MR. HARRIS: Well –

THE WITNESS: Not a biography of L. Ron Hubbard.

MR. FLYNN: I withdraw it, Your Honor.

THE WITNESS: I think that these proceedings deserve to be publicized.

Q BY MR. HARRIS: In fact, while you were in the organization, Mr. Armstrong, you were sending Mr. Garrison internal communications from the church so that he could renegotiate the contract; right?

A I sent Mr. Garrison information which he would need because he was attempting to — because we were both attempting to find out what had happened.

Laurel at that time was out pulling weeds.

David Gaiman was out pulling weeds.

No one with whom we had communicated at the outset — we couldn’t even get communications to Mary Sue to try and figure out what was going on.

At the same time we learned that AOSH PDK did not even know of the existence of the biography.

We attempted to communicate with David Gaiman. There was no such possibility.

I attempted to get Mr. Garrison whatever information I could so that he could figure it out and I could figure it out so that we could proceed logically.

Q And was it at that time while you were still in the organization, Mr. Armstrong, that you became a director of Ralston Pilot?

2958

A No.

Mr. Harris, I have been asked about this so many times.

Q You can answer yes or no.

THE COURT: It assumes that he became a director.

THE WITNESS: Right.

Q BY MR. HARRIS: Did you become a director?

A Let me explain. I don’t want to say no because, apparently, someone made me a director. It was not me. I was never requested to be a director and I have been asked about it so many times.

Q So you know that you were made a director, but you don’t know how it happened?

A I only know from your people. You and Mr. Litt have asked about it. And that is the source of my knowledge.

Q You have never talked to Omar Garrison about it; is that correct, Mr. Armstrong?

A Well, I asked him after Mr. Litt asked me this last time and Mr. Garrison said, “Well, the organization better not ask about this because this is a violation of the settlement agreement.”

Q Really, is that what Mr. Garrison said?

A That is what he told me. And he wouldn’t discuss it further with me.

MR. FLYNN: That settlement agreement, we have never received, Your Honor.

THE WITNESS: So I really don’t know.

2959

Although, you, apparently, have some documents saying that I was a director. But I was never asked to be. I never agreed to be. My name isn’t on anything. And that is it. Whether or not it was another scam, I don’t know.

Q BY MR. HARRIS: And did there come a time, Mr. Armstrong, when you felt that Mr. Garrison and the church were about to settle their differences?

A I don’t think that they have ever settled their differences.

Q In March of 1982, Mr. Armstrong, did you feel that Mr. Garrison and the church were going to settle their differences?

A March of ‘82, I — I think whether or not you would call it a settlement which resulted, I understand sometime in June a settlement of differences — I don’t know.

Q Did you feel, Mr. Armstrong, that your source of documents to write a biography was threatened if Mr. Garrison and the church made up?

A Mr. Harris, that is crazy.

THE COURT: It is a compound question anyway, counsel.

MR. HARRIS: That is all the questions I have, Your Honor.

THE COURT: We’ll take a recess. (Recess.)

2960

THE COURT: All right. We are still here. The witness is retaking the stand.

State your name for the record, sir. You are still under oath.

THE WITNESS: Gerald Armstrong.

REDIRECT EXAMINATION BY MR. FLYNN:

Q Mr. Armstrong, Mr. Harris asked you several questions relative to a book that you were thinking about. Do you recall those questions?

A Yes.

Q Now, in the seven weeks that these legal proceedings have been going on, in which you have been out of work, have you in various locations with me sat and discussed writing a book about these proceedings?

A Yes.

Q And what was your state of mind, Mr. Armstrong, with regard to writing a book about these proceedings?

A Well, I thought that the proceedings and the subject are so apparently paradoxical. I was the defendant in the case, the plaintiff was seeking to suppress evidence, they brought a number of motions to eliminate various parts of the story which I thought were essential parts.

2961

I had obviously been involved in the biography project itself for some years. And it was a bizarre twist that ultimately the man who had sought to have this biography written, namely, L. Ron Hubbard, would end up trying to suppress the very information that was going into the biography.

And the twists and turns of this whole thing and the way in which this whole thing, the proceedings, the contacts with the Scientologists and it sort of revolved around the subject of truth and honesty. And it just seemed like for all Scientologists, I think there is possibly a great deal of interest in the fact that these proceedings are going on; that for the first time, possibly some — in a long time, some truth, at least, is coming out.

The organization has not been able to successfully suppress every bit of evidence. And it certainly has been incredible experience in my life.

So the amount of interest, I think there is out amongst Scientologists, former Scientologists, potential Scientologists, and just the twists and turns that this whole strange proceeding has taken –

No reflection on the court, Your Honor. I don’t mean that.

THE COURT: We have still got the First Amendment.

THE WITNESS: I felt — you know, I have always had an interest in writing. And we have kicked around the idea of this subject.

Q BY MR. FLYNN: So to date has it been any more

2962

than idle conversation with a drink after we have been in court proceedings, Mr. Armstrong?

A Martinis. No. It hasn’t. That is all it has been.

Q And did part of the conversation relate to the — as you put it, the paradoxical aspect of the Plaintiff moving to stay the proceedings when they brought the case?

A That is an aspect of some interest, I am sure.

Q Now, Mr. Harris asked you several questions with respect to the Phoenix Lectures and the religious nature of the organization that you got involved in in 1969-1970; now, when you became involved, Mr. Armstrong, when you first joined the Sea Organization, did you know about a document called “The Fair Game Doctrine”?

A No, not at the time.

Q And did you know that for years the organization had been attacking enemies of the type that you have testified about in this trial?

A No.
Q And Mr. Harris showed you where you had earlier testified as being on an enemies’ list or a CIC cross-marked sheet with categories of enemy, traitor, and doubt; do you recall that?

A Yes.

Q And the name Narcconnon, N-a-r-c-c-o-n-n-o-n, is on there; is that correct?

A Yes.

2963

Q And I take it that you are not aware of a group of Scientologists who split off and tried to form a competitive group to the Scientology Narconon; is that correct?

A I was not aware of it until this. This is a possible name here.

Q But in any event, my name, Michael Flynn, enemy US, heads the list; is that correct?

A Yes.

Q And I have never been a member of the Church of Scientology, is that correct, to your knowledge?

A Right.

Q Or the Department of the Attorney General of Massachussetts?

A No.

Q Now, at any time after you learned about the Fair Game Doctrine, Mr. Armstrong, copyrighted by L. Ron Hubbard in 1966, did you ever consider that to be religious doctrine?

A No.

Q That enemies could be tricked, sued, lied to, or destroyed?

A That is not my concept of religion.

Q Throughout your experiences in Scientology, is that how enemies were treated?

A Yes.

Q Mr. Harris asked you a question about CIC, meaning Control Information Center, as opposed to Combat Information Center, about which you previously testified. Do you recall that question?

2964

A Yes.

Q And I show you a document –

May this be marked next in order, Your Honor.

THE COURT: Triple Y.

Q BY MR. FLYNN: When you were involved with the Church of Scientology, Mr. Armstrong, did you see a document “Confidential, Intelligence Chief”?

A When I was inside?

Q When you were inside.

A I am not sure. We had GO memos like this in the port captain’s office in the intelligence hat, but I cannot say with certainty that this was among them.

Q Did you see documents such as this document where the term “Combat Information Center” was used among GO documents?

A Yes. I knew the term “Combat Information Center,” and learned it on board.

Q And directing your attention to a paragraph under “Duties,” paragraph 4:

Do you have a present understanding, based on your years in Scientology, Mr. Armstrong, what that means?

A That whatever material was on the intelligence CIC board, Combat Information Center, was kept current — what exactly they had on at different times I can’t tell you. But this is just an instruction that that particular board, and

2965

what would be put on it, would be in a separate issue. It is just a duty of this intelligence chief to keep it current.

Q Now, did the port captain’s office maintain the Assistant Guardian’s full hat, about which you previously testified, while L. Ron Hubbard was on board?

A I never saw it there during the whole time. It was brought on board by the Guardian’s office personnel who came on board at the end of 1974 — approximately November, 1 guess. November or December of ‘74.

2966

Q And –

A Mr. Hubbard was then on board; so –

Q Mr. Litt asked you several questions about whether or not people knew in 1973 where Mr. Hubbard was; do you recall those questions?

A Yes, something about that, yes.

Q With regard to pictures that had been taken of him in a Bronx apartment; do you recall that?

A I think it was Queens. I don’t know if that is the Bronx, but it was a Queens apartment.

Q How, did anyone on board know where Mr. Hubbard was during that period of time?

MR. HARRIS: I’ll object.

THE COURT: If he knows.

Q BY MR. FLYNN: To your knowledge that Mr. Hubbard was hiding in Queens?

A No one that I knew.

Q And you did have an understanding while you were in the organization, Mr. Armstrong, as to why Mr. Hubbard was hiding in Queens?

MR. HARRIS: Assumes a fact not in evidence, Your Honor.

THE COURT: I’ll sustain the objection.

It is also compound. There are two concepts, hiding and Queens, the location.

Q BY MR. FLYNN: You know, however, that Mr. Dincalci was with him; is that correct?

A Yes.

Q And did you know anyone on board who knew where

2967

he was?

A No.

Q Now, Mr. Harris asked you several questions with respect to a letter which has been marked as HH that you wrote to Gale Irwin, October 23, 1981 shortly before you left the organization; do you recall those questions?

A Yes.

Q And referring you to page 4 of that letter, Mr. Harris read that: “. . .it is an area which I keep scrupulously legal.”

What were you referring to then, Mr. Armstrong?

A The archives.

Q Now, you previously testified that throughout the period of time you were in the archives project you had a developing awareness of all of the lies that had been told by Mr. Hubbard; is that correct?

A Yes.

Q And that is set forth in the documents under seal; is that correct?

A Yes.

Q And you then went on to state, “. . .this has been my modus operandi for all my Sea Organization years and on many posts closely connected with legal situations.”

Now, what did you mean by that in October, 1981?

A I had tried as much as possible within the parameters of Scientology and working for Mr. Hubbard to do everything I could to keep everything legal.

Q And the very first time you joined the Sea

2968

Organization you were drilled to lie to customs officials; is that correct?

A Yes.

Q And throughout the period of time that you were involved, as you have just testified, you were drilled to lie on various occasions such as to your parents as to where you were; is that correct?

A That is correct.

Q And you have previously testified that that was to conceal Mr. Hubbard; is that correct?

A Yes.

Q And to conceal his location?

A Yes.

Q And when you stated, “. . .1 have always resisted attempts to get me involved in shady actions for short range projects and opted for legality with long range returns,” what did the word “resisted” mean, Mr. Armstrong?

A Many times in Scientology in the Sea Organization I had been asked to do things or requested or ordered to do things. And whenever possible I tried to do what was legal.

Q And, in fact –

A I resisted. 1 was not — I was not successful very often because I simply — because if I had not done those things, I would have wound up on the RPF or the RPF’s RPF or something worse.

Q So you had resisted in an organization that you found disseminating almost nothing but lies; is that correct?

A Yes.

2969

Q And in October, November, or September — October, November of 1981 you have already testified about the letter that you wrote to Cirrus Slevin where you listed the misrepresentations that had been made about Mr. Hubbard and your efforts to correct them; is that correct?

A Yes.

Q And in response to your efforts to correct them, Norman Starkey ordered you to be security checked; is that correct?

A Yes.

Q and you were fearful at that time that you were going to be locked up because of the information you had uncovered about Mr. Hubbard; is that correct?

A Yes.

Q Now, on 1 September, 1981 before you wrote exhibit HH of 23 October, 1981 about which Mr. Harris referred, did you write a letter to Barbara regarding your discoveries about Mr. Hubbard?

A Yes.

MR. FLYNN: May this be marked next in order, Your Honor?

THE COURT: ZZZ.

Q BY MR. FLYNN: At that time and for the next three months did you make an effort to inform the organization about all the lies that Mr. Hubbard had been disseminating?

A Yes.

Q And in referring you to page 2 of that letter, did you begin listing on consecutive pages some

2970

41 misrepresentations about Mr. Hubbard and the organization?

A Yes.

2971

Q So it was at that period of time, after you had spent a year and a half collecting the thousands of documents under seal, that you realized the truth about L. Ron Hubbard; is that correct?

A Yes.

Q And it was at that time you made efforts to change the lies that were being said; is that correct?

A Yes.

Q And it was in that context that you wrote that October 23, 1981 letter; is that correct?

A Yes.

Q And after you were ordered to be sec checked because you didn’t believe that the lies would stop, what did you do, Mr. Armstrong?

A Shortly after that I left.

THE COURT: This attachment about the author, I assume this is what you were critiquing; is that correct?

THE WITNESS: Yes, Your Honor.

THE COURT: Where did this come from?

THE WITNESS: My recollection, this is from — Oh, it was a thing published in probably 1980 or ‘81 called R&D. It is research and discovery volumes, and it is in “About the Author” section, which was in the back of this volume which had just recently been published.

THE COURT: All right.

MR. FLYNN: That is all I have, Your Honor.

THE COURT: Mr. Litt, anything further?

MR. LITT: Your Honor, if we could, in light of this

2972

document that Mr. Flynn has just given to Mr. Armstrong, there are some other related documents but it appears that we don’t have them with us.

MR. HARRIS: Well, I gave then to Mr. Flynn. Maybe he will volunteer then and we can just put them all in.

MR. FLYNN: I am at a loss –

MR. LITT: We can follow one of two procedures. This is one of four, I believe, three or four, materials commenting on various proposed biographies written by Mr. Armstrong, and we intend to present all of them.

THE COURT: You didn’t mean written by Mr. Armstrong?

MR. LITT: No. The letters.

THE COURT: Oh, the critiques.

MR. LITT: Yes. We intend to present all of them to him and provide them to the court, but apparently it appears we don’t have them with us. We would like to know if we could reserve questioning, it will only take five minutes, and do that in the morning.

THE COURT: Yes. Mr. Harris?

MR. HARRIS: No, Your Honor.

THE COURT: Okay. You can step down, sir.

MR. LITT: Your Honor, it is my understanding that Miss Sullivan is the next witness to be called, and we have an additional memorandum which we would like to present to the court at this time concerning the question of our view of how the subject of her testimony should be handled, what procedure we believe should be followed, and what the permissible scope of her testimony should be, and we would like to suggest that

2973

prior to her testimony that we have any necessary argument concerning her testimony and resolve any issues concerning procedure or otherwise with respect to the privileged and the MCCS mission.

MR. FLYNN: If Your Honor please, I think of that as Your Honor hears the testimony it will become fairly apparent that there is no issue. As I represented to the court before, 90 to 95 percent of the information which Miss Sullivan has about the financial transactions of L. Ron Hubbard, and the organization, and the PR line that was sent out on L. Ron Hubbard as opposed to the truth about him, she collected between 1967 and 1960, prior to the MCCS mission ever beginning.

So I think that it would be premature at this point.

MR. LITT: Your Honor, we are quite aware that that is Mr. Flynn’s position, and we addressed the history of that in this memorandum, and we also addressed preliminary procedures which we feel should be followed in order to resolve that question, which includes the — It is our position that in light of the history of this and the past representations concerning this that any testimony from Miss Sullivan on matters that were dealt with in the MCCS mission are inappropriate.

2974

But that in the event that the court does not find that on its face, there are certain procedures that should be followed in the form of the Voir Dire and preliminary determinations before there is any evidence in order to determine what information in fact has a source or a mixed source within privileged information.

THE COURT: Well, let me see your documents.

MR. LITT: Thank you, Your Honor.

I am serving a copy on Mr. Flynn.

We have, if the Court wishes it, that we can submit in camera the materials that Mr. Harris referred to the other day concerning various documents from the MCCS Mission which are privileged documents which, if the Court feels is necessary, clearly establishes the privileged nature of that whole activity.

Your Honor, if I may, we don’t repeat matters that were contained in the previous memoranda submitted. This memorandum is premised on that. Those have already been submitted to the Court.

THE COURT: All right. I have read and considered your memorandum.

First, so we know, when is the date, if there is a date, when this MCCS project can be said to have commenced?

MR. HARRIS: To the best I have been able to determine, Your Honor, it started rather haltingly around February, 1980 and became full blown throughout the latter part of 1980 and ‘81.

2975

There was a MCCS II Mission which was in 1981; in other words, there was a preliminary mission and then there was a MCCS II Mission, July ‘80. I am corrected. July ‘80 is when it first started.

THE COURT: The February date is incorrect?

MR. LITT: No, Your Honor. February ‘80 is the original MCCS Mission. And MCCS II begins in July, ‘80.

THE COURT: Are you capable of proceeding, Mr. Flynn, with this witness, at least the rest of this afternoon and discussing things that occurred before February, 1980?

MR. FLYNN: yes, Your Honor.

MR. LITT: Your Honor, if I may be heard briefly, the problem is, of course, that the mission involved gathering information for presentation to attorneys that occurred prior to 1980, February. So that proceeding regarding testimony concerning events prior to February, 1980 does not really solve the problem as we view it because, in fact, the information that was provided was a variety of historical information that was gathered up of events over prior years at the direction of attorneys in order to solve certain legal problems that were presented; so that it is no solution at all for the testimony in terns of protecting the privilege to proceed by talking about events prior to February, 1960.

Miss Sullivan’s information concerning these events comes, if not in whole, at least in large part from her participation in the MCCS Mission. It appears she has had extensive discussions with her counsel, Mr. Flynn, also Mr. Armstrong’s counsel, in which she has provided him the

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details of the MCCS Mission, her conversations with attorneys, all of which she had no entitlement to do because at the time she held a position and was obligated to uphold the privilege. It is not her personal privilege.

All of this has been provided to Mr. Flynn constituting the basis of his questioning.

It has been consistently represented by Mr. FLYNN that her testimony on these matters would relate to the MCCS Mission only after there were preliminary indications that the Court night not permit or would not permit inquiry into the MCCS Mission because of the problem of attorney-client privilege did it suddenly emerge that Miss Sullivan had all of this purported information independently of that.

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It is quite clear that there has been extensive discussion with Mr. Flynn concerning what she did on the MCCS mission, and the advice of attorneys, and the information gathered up and provided to attorneys, and therefore I think that, our point of view, at least, there are certain things that should happen.

The first is in light of this history, and in light of the invasion of the privilege which has already occurred to this point, and which it is impossible at this point to pull out from this process, it is our position that the court should not permit any questioning at all on the topics that were covered — subject matters of the MCCS mission, because it is not possible at this stage of the proceeding for Mr. Flynn to pose questions which do not flow from his knowledge of privileged information, which was wrongfully obtained.

THE COURT: I don’t think you have any kind of a poison-fruit situation in this here. If the witness has been asked a question involving information that the witness had acquired at some before this particular time that had no connection with this, the witness could give an answer. The fact counsel may have learned something about it from conversations dealing with something else, I don’t think that precludes that type of evidence from being presented.

MR. LITT: It may not preclude it from being presented in general, but it precludes it from being presented by Mr. Flynn.

THE COURT: Who else is going to present it?

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MR. LITT: If Ms. Dragojevic is not privileged to it, if Ms. Dragojevic is not privy to it, then I believe it is precisely parallel to a situation where an attorney is involved in litigation with a prior client and at a minimum with respect to questioning of that client it is not permitted that the attorney will question a client adversely who was a former client.

Here we, in effect, have the same situation, because Mr. Flynn has now been handed attorney information via Miss Sullivan. Therefore, if there is permissible inquiry, and if this matter can be sorted out, which I will get to in a moment, it cannot be done through the questioning by a person who has invaded the privilege. Because that person cannot sort out the information. And in that respect I believe that it is quite similar to the situation of not permitting an attorney to handle certain matters the handling of which inevitably requires drawing on privileged information in an adverse context.

So that we would suggest, one, that it is the obligation at this point, at a minimum, of the defendant to obtain some counsel who is at least not privy to these conversations with Miss Sullivan to do the questioning.

In addition, we think that the court must make a determination of whether it is possible at all for Miss Sullivan in fact, to segregate this information, especially in light of the history of these affairs, in which there was no indication until there was a preliminary ruling by the court that Miss Sullivan had any such prior knowledge.

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Prior to that it was –

THE COURT: She must have functioned for years and had knowledge over those years. I mean, she wasn’t simply sitting there with a closed mind.

MR. LITT: Not on these subjects.

THE COURT: That is to be decided. That is what we are going to find out.

MR. LITT: I agree. But what I am suggesting, that before the contents of anything emerges that that
predicate fact must, in fact, be determined. And whether or not it is, in fact, possible for her to segregate the information she learned in her capacity within the MCCS mission from any information that she purportedly had from an earlier period when she was not acting as a holder of the privilege or as a person who was gathering information protected by the privilege. And that until that preliminary fact is determined, if it can be determined, and we suggest that it is the burden of the defendant to make that showing under the circumstances– until that time it seems to us that no testimony can be permitted.

In other words, the defendant should have the burden at this point to, through questioning by counsel other than someone who has received the privileged information, establish that Miss Sullivan can testify on certain matters independently and that the information can be sufficiently segregated so that her testimony does not, in fact, constitute an invasion of the privilege.

And without that occurring, then we have a

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situation where in reality the privilege is being violated through a procedure which I would suggest is somewhat improper. It seems to us that Mr. Flynn should not have elicited attorney-client information from Miss Sullivan to begin with, since it was clear that it was obtained in a privileged setting.

THE COURT: Well, let’s not get off into left field. I disagree with your point that it has to be some other lawyer involved in it. I think if counsel is going to represent that this witness can give answers based upon knowledge that she had acquired prior to February, 1980, and the witness so indicates, and I will so instruct her — at least we don’t have any particular problems as far as I can see.

I don’t know what the witness is going to say. I don’t know what questions are going to be asked. But it seems to me that as long as the witness understands what the ground rules are here, at least until some other order of the court, that she will have to answer within those confines.

MR. LITT: Thank you. Your Honor.

MR. FLYNN: Let me correct one thing on the record. I also represent Miss Sullivan in connection with her having obtained immunity from prosecution in connection with her testimony about financial transactions of Mr. Hubbard. And in my initial conversations with Miss Sullivan it became abundantly clear to me that the information that she had strictly relating to the MCCS mission related to future and currently ongoing criminal activity and/or fraudulent activity.

THE COURT: Well, if you want to develop that, I think it should be done by way of a declaration of the witness and

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something that can be reviewed by the court and counsel can also review it in counter-declarations or documents that the plaintiff has to submit on the subject. In other words, I was taking the position that it would be no apparent problem to me to deal with subjects which existed prior to ‘80, if she knew about them, and her knowledge proceeded that date.

If you want to go into things which occurred in MCCS, I think then the proper way to proceed you have the burden of showing that there is no privilege because of this crime-fraud exception, and it seems to me the proper way to do that — it could be done, of course, in camera, but I’m not too anxious to do that. I would rather see a declaration and take that as the initial step and go from there.

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MR. FLYNN: I didn’t make myself clear.

I intend to go forward based on the Court’s suggestion about things prior to 1980.

What I was responding to was Mr. Litt’s implication of some impropriety on my part of receiving attorney-client information.

THE COURT: Well, I’m sure that she is entitled to have legal advice and entitled to use her judgment as to what she was able to disclose or not disclose. That is why we have attorneys and right to counsel guaranteed by the Sixth Amendment, Fourteenth Amendment, California Constitution.

Do you have anything else on the subject? Statutes?

Let’s go ahead and see what happens.

MR. FLYNN: Various Hat Packs on the Church of Scientology, Your Honor.

Miss Sullivan, please.

LAUREL SULLIVAN, called as a witness by the defendant, was sworn, and testified as follows:

THE CLERK: Please, raise your right hand to be sworn.

THE WITNESS: I do.

THE CLERK: Be seated. Please, state your name and spell your last name.

THE WITNESS: Laurel Sullivan, S-u-l-l-i-v-a-n.

THE COURT: Miss Sullivan, up this point and for awhile anyway until further notice counsel is going to be asking

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you questions. I only want you to answer the question if you’re capable of doing so based upon a knowledge that you had, actually had in your mind prior to February, 1980.

If you are of the belief that you cannot limit your answer in that fashion, then tell me and I’ll have to sustain their privilege on that basis — it is not that I have to, but I will because I have taken that position. But if you’re capable of answering it based upon matters or information that you had prior to February, 1980, you may do so.

So let’s go forward and see what happens.

Do you understand?

THE WITNESS: Yes.

DIRECT EXAMINATION BY MR. FLYNN:

Q Miss Sullivan, you are currently living in California?

A Yes.

Q And at some point in time in the past you were an employee of L. Ron Hubbard; is that correct?

A Yes.

Q Now, when were you last affiliated with L. Ron Hubbard or any Scientology organization?

A November 21, 1981.

Q And when did you first begin to be affiliated with L. Ron Hubbard or any Scientology organization?

A In September, 1966.

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Q And would you just briefly describe the circumstances under which you first became involved with L. Ron Hubbard or Scientology.

A I have to start with Scientology first.

My father was a Scientologist and received literature. So I did hear about it from time to time in our family.

In September 1966 I traveled with him to England and lived in East Grinsted [Grinstead] where the Scientology Center was at that time, the Worldwide Headquarters. And met Scientologists and became involved in Scientology that fall.

Q Now, in September of 1966 how old were you?

A Seventeen.

Q And at the risk of incurring your ire, how old are you at the present time, Miss Sullivan?

A Thirty-four.

Q After your initial exposure to Scientology did you become more actively involved in any Scientology organization?

A Yes. I joined staff in January, 1967 at Saint Bill Manor and left briefly for the summer to return to do courses in the fall. And I joined the Sea project in November, 1967.

Q Now, in November, 1967 what was the Sea project?

A It was a project of L. Ron Hubbard and some friends of his. And the purpose was to find a safe base for him and for the upper levels of Scientology.

Q And who did you work for at that time?

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A That wasn’t clear. It was a Sea project. And there were no contracts or employee agreements. But L. Ron Hubbard was the person in charge.

Q And what did you do in connection with the Sea project?

A Well, we — the initial application was to go and help Ron do what he was doing.

In the beginning I just went to the ship in Southampton.

Q Now, at some point in time within the next year or two did you find out the name of any corporation that owned the ship?

A Yes.

Q And what did you find out?

A Well, before I went I did a typing project for L. Ron Hubbard’s personal secretary. And on that typing project I typed the manual which was about three inches thick which was all about the sea project and who owned it and the duties involved, the officers, and who was in charge.

Q And what was your understanding at that time as to who owned it and what the various duties were that you just described?

A The Hubbard Explorational Company owned the ship. And I am not clear on the last half of your question.

Q What understanding did you have as to what relationship the Hubbard Explorational Company had to any Churches of Scientology?

A I was not sure. I know that L. Ron Hubbard had

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told us that he bought the ships personally.

Q Now, at some point in time did the — what ship did you initially go on?

A The Royal Scotman.

Q That subsequently became The Apollo?

A Yes.

Q Where did The Royal Scotman go?

A Well, it was delivered from Glasgow; arrived in Southampton where I got on.

Then we went off the Coast of Brest, France; down the Coast of Portugal; tried to land in Gibraltar; was refused; went to Palermo; Monte Carlo; Sardinia; to Valencia.

We stopped in Valencia and the ship was berthed there and anchored there for some few months. Then it went on a training cruise to Alicante, Spain and year round in Spain. And from there, I left at that time.

Q Where did you leave and go to?

A I left from Valencia and went to England, And then after four days, to Edinburgh.

Q During that period of time that you were on the ship what understanding did you have as to who you worked for?

A Well, I worked for L. Ron Hubbard.

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Q And what were your duties on board the ship?

A Well, first I was a steward, then I was an officer steward, then I did some organizational duties, then I transferred ships and was a steward again, I cooked, and after that I — let’s see. After that, when I went to Edinburgh, I was a tour member and held various administrative posts throughout the organization there. Then I became the L. Ron Hubbard Communicator.

Q When did you become the L. Ron Hubbard Communicator?

A It is in the fall of 1968.

Q And what were your duties in that post?

A To make sure his orders and policies were complied with by everyone in the organization.

Q And did you see his orders on a daily basis at that time?

A Not daily. They were often Telexed orders that came from him directly, though, to the organization.

Q And as the Communicator you would receive the orders from Mr. Hubbard, and who would you communicate them to?

A The whole organization, from the top down.

Q And did you learn at that time, in the fall of 1968, as to the management structure of the organization?

A Yes.

Q And what did you learn?

A I learned that ultimately L. Ron Hubbard controlled the organization, that any order given that was different than his was pretty much ignored or canceled, and

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that in ay capacity to insure that his orders were complied with I often cancelled other orders of other people that were contrary to his.

Q Now, did the organization basically at that time have a military-type command structure up to L. Ron Hubbard?

A Yes.

Q And prior to 1968 had you had the opportunity to personally observe Mr. Hubbard in the context of managing Scientology organizations?

A No, not directly.

Q So your first opportunity was in the fall of 1966?

A Yes.

Q And did you receive orders personally from L. Ron Hubbard at that time?

A Yes. I received them but they weren’t to me, they were to be delivered by me to others.

Q You were like a communications link to the rest of the organization?

A That’s right. I was his representative in that organization.

Q Now, when you say “his representative in that organization,” what did that mean in 1968, Miss Sullivan?

A It meant that if anyone had a question about his order they should come to me and get it clarified. It meant that if it was considered too broad it should be clarified by roe, if it needed to be interpreted that people came to me on it, when they complied with the order they would

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send the reply via me to him and they would attach their evidence that they had, in fact, complied with it.

Q Now, at that time were you receiving wage vouchers?

A At what time?

Q In the fall of 1968.

A Yes.

Q And what did the wage vouchers, if anything, say on them?

A They said “AOUK.”

Q What was AOUK?

A Advanced Organization United Kingdom.

Q Prior to that had you received wage vouchers from Hubbard Exploration Company?

A Yes, I received them, but I don’t know if they were printed. I think they were blank.

Q Now, at some point in that period of time did you learn about the purchase of certain property in Rhodesia?

A No.

Q When did you learn about the purchase of property in Rhodesia?

A November, 1981.

Q Okay. Prior to November, 1981, did you have any understanding about any aspects of the purchase of property in Rhodesia?

MR. LITT: Objection. Prior to February, 1980, Your Honor.

TKE COURT: Well, make it prior to February, 1980.

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Q BY MR. FLYNN: Prior to February, 1980.

A Yes.

Q And what understanding did you have prior to that date?

MR. HARRIS: I will object to the word “understanding” under these circumstances, Your Honor. This witness’ state of mind, unlike the defendant’s, is not at issue. If she heard it from someone or –

THE COURT: I will sustain the objection.

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Q BY MR. FLYNN: Let me ask you this, Miss Sullivan: With regard to the subject of Rhodesia, when is the first time that you acquired any information about that subject?

A Late ’60’s.

Q And under what circumstances did you first acquire that information?

A Well, I was at Saint Hill and as a student. People were very interested in where Ron was and where he had been. And at that time it was recent that he had lived in Rhodesia and that he had returned from there.

He gave his last lecture to the students at Saint Hill at which my father attended.

His daughter was a training twin with my father; so I knew her well. And through these channels, I learned about Rhodesia and that a project had gone on there and that it was a considerable project.

Q Did you acquire any information at that time as to the purchase of any property in Rhodesia?

A No specifics.

Q Did you acquire general information?

A No.

Q Now, how long did you remain the L. Ron Hubbard communicator?

A At that organization, until May, 1969.

MR. HARRIS: Just so I am clear, Your Honor, I want to move to strike the witness’ testimony about where Mr. Hubbard was as based on hearsay.

THE COURT: I’ll deny the motion. It is apparently

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common knowledge in the organization at that time.

MR. HARRIS: Just so I don’t have to keep jumping up, Your Honor, each time she gets information from anybody else, my objection would be hearsay. At this point I don’t believe this witness’ state of mind is relevant here.

THE COURT: Fine. Be that as it may. If you want to object, you should object.

Q BY MR. FLYNN: During the periods of time you were L. Ron Hubbard’s communicator could you describe the tactics of communications you received from L. Ron Hubbard and who you communicated them to?

A Okay. I was L. Ron Hubbard’s communicator several times. And the first time was in Edinburgh; the second time was in Los Angeles; and the third time was on the ship.

So during that time, those times, the kinds of communications I would receive from him were orders to anyone in the organization which I would log, record, and send on and check up on until they were completed. And then I would assist with that person reporting back to him a compliance that it in fact was done. That is the major truck and trade and track of a LRH communicator.

I also received mail for him personally and I answered that mail for him personally.

So in a sense there were some secretarial activities. And from time to time there were requests from him personally regarding his office and his possessions in his office and records, et cetera.

Q Now, did you have access to those records?

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A Yes.

Q And what types of records were there?

MR. HARRIS: Is this in UK, Your Honor, AOUK? just so we get the place where it is.

Q BY MR. FLYNN: Is it in the United Kingdom?

A In all three places.

Q Just restricting yourself now to the first period when you were the L. Ron Hubbard communicator, what types of records did you have access to?

A His handwritten personal notes.

Q And what did those notes relate to?

A They related to the operation of that organization; they had to do with the naming of organizations in the United Kingdom, particularly in Scotland.

They had to do with a public relations campaign that was being done, slogans, some tapes and instructions to the organization, the purpose of the organization, why they were there, how their financial transactions should go as far as what organizations they should support, what income levels were expected, that sort of thing.

Q How, during that period of time did you make observations — strike that — were you aware that in 1966 Mr. Hubbard had allegedly resigned from conducting the management of any Scientology organizations?

A Yes.

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Q And in your experience, when you were the L. Ron Hubbard Communicator, was that true?

A No.

Q And was Mr. Hubbard conducting the Management of organizations when you were the L. Ron Hubbard Communicator?

A Yes.

Q During the period of time, the first period of time that you were the L. Ron Hubbard Communicator, did you see orders from Mr. Hubbard relating to financial transactions of the organization?

A Yes.

Q And what did you see?

A I saw Telexes on statistics, which reported income, his replies, and I was watchful for any instructions that we should do from him, and I saw that those were carried out. They had to do with how income should be collected, promotional, actions, where money should go from the AO, or the organization, as far as its reserves were concerned, and at that time the advanced organizations were shifting in a management framework and were beginning to support the ship activities, and so the centralization of income from the United Kingdom for Sea Organization activities was occurring in Edinburgh and later in East Grindsted, and there was some discussion over that.

Q And did you see any dispatches relating to the transfer of Scientology funds to corporations owned or controlled by L. Ron Hubbard?

A No.

Q At a subsequent point in time did you begin to

2995

see such orders?

A Could you clarify that question.

Q At some subsequent point in time did you begin to see orders relating to financial transactions?

A Yes.

Q And when did you see those?

A From time to time throughout all of my positions in Scientology.

Q And what types of orders were those. Miss Sullivan?

MR. HARRIS: Can we get a time frame, Your Honor?

MR. FLYNN: Prior to February, 1980.

THE WITNESS: They had to do with the setting up accounts, the transfer of accounts, amounts in accounts, what funds should be spent on, allocation of funds to projects, and pay.

Q BY MR. FLYNN: Did they cover most aspects of the financial transactions of L. Ron Hubbard in the organization, from what you could see at the time?

A Yes.

Q Now, after you were L. Ron Hubbard Communicator, what was your next post?

A After LRH Com UK, I went back to the ship for about two weeks. I was a layout artist. After that I was the medical officer for six months.

Q Who made you the medical officer?

A Quentin Hubbard.

Q And on whose orders –

THE COURT: If you know.

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Q BY MR. FLYNN: If you know — were you made the medical officer?

A On his own origination, on L. Ron Hubbard’s approval.

Q Had you had any medical experience or background at that point?

A No.

Q And after you were the medical officer what did you do?

A I was transferred to the advanced organization, Los Angeles, as the supercargo and the LRH Communicator.

Q As the LRH Communicator, what did you do?

A Similar duties to the earlier one only expanded.

Q In what way were they expanded?

A Well, one instruction that came to me was to find a building whereby our organization could take over another organization, and it was a lengthy handwritten communication from L. Ron Hubbard to myself through Fred Hare.

Q When was this, Miss Sullivan?

A It was late 1969.

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Q Go ahead and continue.

A It simply instructed us to find a building whereby we could take over the American Saint Hill Organization. And I logged it.

Because at that time that particular organization wasn’t doing very well. Our own income and dispersements and our budgets and financial planning and reserve accounts were watched very closely. We were expected to support all of the Sea Org operations from that organization.

We were briefed by L. Ron Hubbard personally before we left the ship for approximately an hour and a half to two hours. And they were in very, very bad financial straits, to the point of telephones almost being cut off and the crew not really being fed very well.

And these details were gone into and, of course, we were expected to make a considerable amount of income.

Q And so L. Ron Hubbard briefed you and dispatched you on this mission?

A Yes.

Q And who else went on that mission?

A Fred Hare and Clarice Jackson and a fourth person joined us in Los Angeles, Dawn Titus.

Q And how long did you stay on that mission?

A Well, we rebriefed on the local, that is, in Los Angeles a couple of times. And I returned to the ship finally in June of ‘71. So from October or late October, ‘69 until June ‘71.

Q Now, when you were on this mission and income

2998

was collected from this organization, where did it go?

A It went into our local bank accounts and based on what our budget was and based on what was surplus to that budget, those reserves were put into what was called the FBO No. 1, FBO No. 2 account.

And as I understood it at that time, money was transferred from there to the ship when it was needed or called for or to overseas bank accounts.

Q Now, what does FBO stand for?

A Flag Banking Officer. At that time it was Flag Banking Officer. It was later changed to Finance Banking Officer.

Q So the excess funds from — strike that — was that a separate corporation that you were sent in to rejuvenate?

A It was part of the church of Scientology of California.

Q Now, so those were Church of Scientology of California funds that were being collected; is that correct?

A Yes.

Q And then the surplus funds went to the ship or went to overseas bank accounts; is that your understanding?

A That is correct. And also expenses of the ship locally were paid out by us locally; that would mean travel fares — their crew members being recruited locally in Los Angeles going to a remote location such as Portugal or Morocco would receive their airfares locally. So some of those were ship expenses, but taken care of on a local basis.

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There was an office set up which was the Flag Operations Liaison Office before that, the OTL to dispatch people and to take care of that local business.

Q Now, at that time who owned the ships that these church monies to pay expenses were being — who owned the ships at that time?

A By 1971?

Q Correct.

A 1969 to ‘71?

Q Correct.

A The ownership transferred, I believe, from L. Ron Hubbard to OTC just before that time.

Q And what was OTC? Was that a profit-making corporation?

A Yes.

Q And who owned the shares of OTC?

A That, I am not familiar with.

THE COURT: We’ll reconvene tomorrow morning at 9 o’clock.

(At 4:02 p.m., an adjournment was taken until Thursday, May 24, 1984; at 9:00 a.m.)

*
On October 6, 1993, Armstrong 2 and 3 were consolidated. On September 12, 1994, Armstrong 2 and 3 were consolidated with Armstrong 4 under Marin SC No. 157680.
All are now called Armstrong 4.
On April 9, 2008, Armstrong 4 was consolidated with Armstrong 7.